Reynolds American advertising & marketing assignments

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Reynolds American is the clear #2 in the US tobacco market behind Philip Morris and the local leader in e-cigarettes. Brands include Newport, Camel, Pall Mall and Natural American Spirit, and the company sells a growing selection of smoke-free products such as snus, Grizzly snuff and Vuse e-cigarettes. Combined market share by volume was almost 35% in 2016, including 14% for Newport and around 8% apiece for Camel and Pall Mall. The business was formed in the summer of 2004 from the merger of the former #2 RJ Reynolds, with third-ranked rival Brown & Williamson. The latter's previous owner, British American Tobacco, remained the group's biggest shareholder with a minority stake until 2017 when it acquired the outstanding shares. In 2015, Reynolds absorbed smaller rival Lorillard, adding menthol Newport and several other discount brands to its portfolio, but shedding Winston and Salem to secure regulatory approval. During the 1980s, RJ Reynolds was part of RJR Nabisco, a broad-based consumer products conglomerate which made history as the target of what was then the biggest ever takeover deal, worth $30bn. The debt incurred in the process led the group into a steady decline, and to survive it sold off Camel and Salem outside the US to Japan Tobacco. Ricardo Oberlander is CEO of Reynolds American. For 2016, its last full year as a separate company, Reynolds reported revenues of $12.5bn. See also:

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Historical profile information for Reynolds American

Recent stories from Adbrands Update:

Adbrands Weekly Update 18th Jan 2017: US tobacco group Reynolds American accepted an improved offer from British American Tobacco for the shares it doesn't already own. BAT increased its bid for the outstanding 58% of equity from around $47bn to $49.4bn, valuing Reynolds at around $85bn. Despite the steady and continuing decline in the number of American smokers, the US remains the world's most profitable tobacco market. According to BAT CEO Nicandro Durante, net revenues from two packets of cigarettes sold in the US are equivalent to six packs in other developed markets, and as many as 13 packs in emerging markets. Combined revenues from the merged group would be around $26bn. Reynolds is the #2 in US cigarettes behind Altria's Philip Morris USA, but the local leader in electronic cigarettes. Most observers expect Altria to respond by proposing the reunification of Philip Morris USA with Philip Morris International, spun off as a separate company in 2008.

Adbrands Weekly Update 27th Oct 2016: British American Tobacco has offered to buy the 58% of equity it doesn't already own in the #2 US tobacco group Reynolds American for $47bn in cash and stock. BAT acquired a 42% holding in Reynolds following the transfer of its own Brown & Williamson business in 2004. Since then, BAT has had no direct presence in the US market. The bid has yet to be accepted by Reynolds. According to insiders, that company is seeking a better price. A combination of the two businesses would create the world's biggest tobacco company by revenues, though it would continue to sit behind Philip Morris International by global market share. The key attraction of Reynolds to BAT, besides access to the US market, is the smaller company's expertise in alternative tobacco products.

Adbrands Weekly Update 30th Sept 2015: US tobacco group Reynolds American sold international rights to its organic and additive-free cigarette brand Natural American Spirit to Japan Tobacco for a whopping $5bn, around eight times current US revenues. JT already owns international rights to other Reynolds brands such as Camel and Winston, which it acquired in 1999. In the US, American Spirit is now one of the top 10 tobacco brands by volume.

Adbrands Weekly Update 11th Jun 2015: After almost a year of regulatory and legal investigation, the merger of US tobacco companies Reynolds American and Lorillard was approved and will complete this week. At the same time, the new group will sell its Winston, Kool, Salem and Maverick brands to Imperial Tobacco of the UK, significantly boosting that company's presence in the US market.

Adbrands Weekly Update 24th July 2014: A US court took the shine off Reynolds American's recently announced merger with Lorillard, awarding punitive damages against the tobacco giant of a whopping $23.6bn - almost as much as combined revenues for the past three years - in a lawsuit brought by the widow of a smoker who died of lung cancer almost 20 years ago. Reynolds is to appeal the verdict - lavish penalties such as this have in general been reduced in the past.

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