Bid rumours are once again swirling around Bristol-based Imperial Tobacco – this time suggesting it could be in line for a break-up approach.
Shares in the group, the region’s biggest company by turnover, edged forward 9p to 2,170p this morning in the wake of speculation that it could be the target of an approach worth 3,500p a share.
City insiders say companies from the US and China may be considering a possible move with a view to splitting up Imperial and selling the parts – at a profit – to other tobacco firms.
However, most dealers appear to have poured cold water on the rumours, pointing out such a deal could face considerable competition problems.
Imperial – the world’s fourth-biggest tobacco company with brands including Lambert& Butler, John Player Special, West, Golden Virginia and Rizla – was the subject of similar speculation earlier this year when Goldman Sachs said the sector could see a rush of consolidation, picking out Imperial as the most likely target.
Larger rivals British American Tobacco and Philip Morris were named as obvious predators – but nothing came of the rumours.
There were also suggestions last year that Imperial, which is building a new headquarters in South Bristol – the part of the city where it has its roots – was in talks to merge with America’s third-largest tobacco business, Lorillard.
Such a deal would have valued both companies a combined value of nearly £29bn.
