The ratings on Richmond, Va.-based Altria Group Inc. reflect the company's exposure to U.S. tobacco litigation risk and its participation in the highly competitive and declining U.S. cigarette market. The company's leading market positions in the U.S. tobacco industry, its leading position in the smokeless tobacco category following the acquisition of UST Inc., and strong free cash flow generation partially offset these risk factors. Altria is a holding company for its wholly owned subsidiaries: PM USA, the largest U.S. producer of cigarette products. John Middleton Co., a leading manufacturer of machine-made large cigars, which Altria acquired for $2.9 billion in December 2007. Philip Morris Capital Corp., an entity with a portfolio of leveraged and direct finance leases. U.S. Smokeless Tobacco
