El Presidente Posted July 18, 2007 Share Posted July 18, 2007 NEW YORK, July 17 (Reuters) - Spanish cigarette and cigar maker Altadis SA (ALT.MC: Quote, Profile , Research) has agreed to be acquired by Imperial Tobacco Group PLC (IMT.L: Quote, Profile , Research) for about 13 billion euros ($17.92 billion), according to the online edition of The Wall Street Journal. An acquisition of Altadis would give Imperial the world's largest cigar business by sales, according to The Journal. Private equity group CVC Capital Partners Ltd. (CVC.UL: Quote, Profile , Research) had also pursued a takeover of Altadis, and earlier in July media reports said that CVC and Imperial might make a joint bid for the company. Link to comment Share on other sites More sharing options...
El Presidente Posted July 18, 2007 Author Share Posted July 18, 2007 Of all the mergers possible this is perhaps the sweetest. Imperial doesn't have a Cigar Business. Altadis hold the expertise and Cuban know how. $17 Billion is a whole heap of dollars and they will want a return. At the same time the purchase buys Imperial some breathing space from being swallowed up themselves. I wonder what Altadis's $500 Million dollar investment for 50% of Habanos s.a is worth today? I would suspect it was a hell of a sweet buy ;-) What does it mean for the Habanos consumer? Higher pricing. Link to comment Share on other sites More sharing options...
zuma Posted July 18, 2007 Share Posted July 18, 2007 According to Bloomberg, Altadis has yet to comment on the raised bid from Imperial... If the bid succeeds we may have a chance of seeing the rebirth of Cuban Davidoff's through Imperials half ownership of Habanos SA (Imperial currently owns the Davidoff brand)... Link to comment Share on other sites More sharing options...
El Presidente Posted July 18, 2007 Author Share Posted July 18, 2007 » According to Bloomberg, Altadis has yet to comment on the raised bid from » Imperial... » » If the bid succeeds we may have a chance of seeing the rebirth of Cuban » Davidoff's through Imperials half ownership of Habanos SA (Imperial » currently owns the Davidoff brand)... It would be a cold day in hell before Cuba agreed to a Cuban Davidoff. Every new cigar needs to be approved by Tabacuba so I wouldn't be pinning any hopes on a release under the current administration. Link to comment Share on other sites More sharing options...
zuma Posted July 18, 2007 Share Posted July 18, 2007 » It would be a cold day in hell before Cuba agreed to a Cuban Davidoff. Every new cigar needs to be approved by Tabacuba so I wouldn't be pinning any hopes on a release under the current administration. ...I sense some insider info. Please forgive my ignorance, but why wouldn't the current Tabacuba admin consider manufacturing Davidoff's again? Link to comment Share on other sites More sharing options...
Ken Gargett Posted July 18, 2007 Share Posted July 18, 2007 » » What does it mean for the Habanos consumer? » » Higher pricing. and for the retailer? higher profits. next life, you are coming back as something in my aquarium. Link to comment Share on other sites More sharing options...
El Presidente Posted July 18, 2007 Author Share Posted July 18, 2007 » » It would be a cold day in hell before Cuba agreed to a Cuban Davidoff. » Every new cigar needs to be approved by Tabacuba so I wouldn't be pinning » any hopes on a release under the current administration. » » ...I sense some insider info. Please forgive my ignorance, but why » wouldn't the current Tabacuba admin consider manufacturing Davidoff's » again? It was the demise of Davidoff which saw the the coming of Cohiba. Zino burn't over 100,000 ($3m) Davidoff cigars in 1989 as a protest to Cuban quality. The relationship was terminated in 1991 and Davidoff moved their operations to the Dominican Republic. The last 10 years of production was dominated by issues of quality and who exactly owned the trademark "Davidoff". Still a sore wound in Havana. Link to comment Share on other sites More sharing options...
zuma Posted July 18, 2007 Share Posted July 18, 2007 » Zino burn't over 100,000 ($3m) Davidoff cigars in 1989 as a protest to Cuban quality. The relationship was terminated in 1991 and Davidoff moved their operations to the Dominican Republic. » The last 10 years of production was dominated by issues of quality and who exactly owned the trademark "Davidoff". » » Still a sore wound in Havana. Hombre! Now I understand!!! PS. Altadis have just officially announced that: Altadis has confirmed to Imperial Tobacco that it considers that the Offer is attractive and that, in the absence of a competing offer at a higher price being filed with the CNMV, the Board of Altadis will recommend the Offer to Altadis' shareholders and the directors of Altadis intend to accept the Offer in respect of their own beneficial shareholdings. Link to comment Share on other sites More sharing options...
brian1 Posted July 18, 2007 Share Posted July 18, 2007 That is a big purchase price. Imperial is a public company and public companies have one objective higher profits. Hmm I wonder how Imperial will recoup their investment?..... potentially much higher cigar prices in the not too distant future. » NEW YORK, July 17 (Reuters) - Spanish cigarette and cigar maker Altadis SA » (ALT.MC: Quote, Profile , Research) has agreed to be acquired by Imperial » Tobacco Group PLC (IMT.L: Quote, Profile , Research) for about 13 billion » euros ($17.92 billion), according to the online edition of The Wall Street » Journal. » » An acquisition of Altadis would give Imperial the world's largest cigar » business by sales, according to The Journal. » » Private equity group CVC Capital Partners Ltd. (CVC.UL: Quote, Profile , » Research) had also pursued a takeover of Altadis, and earlier in July » media reports said that CVC and Imperial might make a joint bid for the » company. Link to comment Share on other sites More sharing options...
12stones Posted July 18, 2007 Share Posted July 18, 2007 I wonder if they've looked at the proposed federal tax on cigars in America. With the potential to reach up to $10 per cigar, that will cut into sales and profit for sure, if it passes that is. Link to comment Share on other sites More sharing options...
smokum Posted July 18, 2007 Share Posted July 18, 2007 LOLOL...a couple of well placed lobbyi$t$ will assure that no tax like that ever sees the light of day. Link to comment Share on other sites More sharing options...
Colt45 Posted July 18, 2007 Share Posted July 18, 2007 » What does it mean for the Habanos consumer? » » Higher pricing. » Sweet!! Link to comment Share on other sites More sharing options...
genevapics Posted July 18, 2007 Share Posted July 18, 2007 » LOLOL...a couple of well placed lobbyi$t$ will assure that no tax like that » ever sees the light of day. DING! DING! DING! Absolutely smokum. Link to comment Share on other sites More sharing options...
greenpimp Posted July 18, 2007 Share Posted July 18, 2007 I just read 16 billion Euros. It seems no matter what happens, it means higher prices. Damn. Rob, I seem to recall you saying that it would be a cold day in hell before the Cubans agreed to this with Imperial. How big of a honey pot do you think they got to go along? Link to comment Share on other sites More sharing options...
El Presidente Posted July 18, 2007 Author Share Posted July 18, 2007 » I just read 16 billion Euros. » » It seems no matter what happens, it means higher prices. Damn. » » Rob, I seem to recall you saying that it would be a cold day in hell » before the Cubans agreed to this with Imperial. How big of a honey pot do » you think they got to go along? They haven't agreed and they have a clause in the contract with Altadis that they can walk away from the JV should their be a change in ownership of Altadis that TABACUBA cannot stomach. My understanding is that the CEO of Imperial and CEO of Altadis are about to meet with TABACUBA executives. I am assuming the CEO's of ALTADIS and IMPERIAL will not be limited to the $10,000 USD Customs Currency restrictions at Havana Airport Link to comment Share on other sites More sharing options...
smokum Posted July 19, 2007 Share Posted July 19, 2007 I can just see Castro getting wheeled up to the meeting room with an empty suitcase or 3. Link to comment Share on other sites More sharing options...
El Presidente Posted July 19, 2007 Author Share Posted July 19, 2007 » I can just see Castro getting wheeled up to the meeting room with an empty » suitcase or 3. TABACUBA is in for a nice payday. Link to comment Share on other sites More sharing options...
Colt45 Posted July 20, 2007 Share Posted July 20, 2007 I just read an article which states that Cuba could exercise a "change of control" clause if Imperial acquires Altadas. It basically means that even if Imperial does acquire Altadis, Cuba could keep Habanos S.A. - Imperial would not get Altadis' 50% stake. Link to comment Share on other sites More sharing options...
brian1 Posted July 20, 2007 Share Posted July 20, 2007 Imperial Chief Heading to Cuba to Keep Habanos Posted: Thursday, July 19, 2007 By David Savona Gareth Davis, chief executive officer of Imperial The pending acquisition of Altadis S.A. by Britain's Imperial Tobacco PLC would instantly transform Imperial -- the world's fourth largest tobacco company -- from a bit player in the cigar business to the world leader. Yet a key segment of the Altadis cigar business might not come along for the ride should the acquisition go through. The global star of the Altadis cigar business is its 50 percent ownership of Habanos S.A., the worldwide distributor of Cuban cigars. Altadis bought half of Habanos for $477 million in 2000. But the joint venture includes a change of control clause, which the Cubans could exercise once Altadis is officially owned by Imperial. Imperial's chief executive officer, Gareth Davis, said in a conference call yesterday that he intends to travel to Cuba and meet with the Castro government to secure support for the deal and keep Habanos from exercising its change of control clause. "He did say he would be heading to Cuba," confirmed an Imperial spokesman. "We don't think there will be any issues." "We are hopeful that the change of control clause will not be exercised," said Davis, as quoted in The Times Online. "We hope this joint venture will continue to go from strength to strength -- it's a business we plan to invest in." Imperial is clearly concerned with keeping Habanos, which is the distributor of all of Cuba's cigars, including such famed names as Montecristo, Cohiba, Romeo y Julieta and H. Upmann. "These [are] iconic brand names, very aspirational, almost luxury brand names known around the world," said Davis at a press conference where the deal was announced. The Imperial spokesman said there was no timetable for the Cuba trip, and hinted that it would not happen for some time. For more on the Imperial acquisition, see the next issue of Cigar Insider. Link to comment Share on other sites More sharing options...
tigger Posted July 20, 2007 Share Posted July 20, 2007 This also means Lew Rothman's gonna be working for a buncha Brits. :-D Link to comment Share on other sites More sharing options...
El Presidente Posted July 20, 2007 Author Share Posted July 20, 2007 » I just read an article which states that Cuba could exercise a "change of » control" » clause if Imperial acquires Altadas. It basically means that even if » Imperial does » acquire Altadis, Cuba could keep Habanos S.A. - Imperial would not get » Altadis' 50% » stake. Correct Colt. I believe the price for agreement will be 50% of the value of the Habanos s.a share in the valuation of Altadis by Imperial. In cash. Link to comment Share on other sites More sharing options...
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