September 9, 2008
Reynolds Cuts Jobs; Altria to Acquire UST
Article in the Wall Street Journal -- Reynolds American to Cut 570 Jobs, by David Benoit. Here's an excerpt:
Reynolds American Inc. will lay off 10% of its U.S. work force and refocus R.J. Reynolds Tobacco Co. as the company deals with a slowing market for cigarettes and a competitor's big move into the smokeless-tobacco market.
The announcement from Reynolds American comes the day after competitor Altria Group Inc. announced it was acquiring UST Inc. in a $10.4 billion deal. That deal gives the parent of Marlboro cigarettes the lead in smokeless-tobacco production -- the fastest-growing tobacco segment -- with UST's Skoal brands.
Reynolds American said Tuesday it is looking to simplify and streamline its product lines in order to cut costs. The efforts -- which include shifting company focus from the menthol Kool brand cigarette to the Camel brand -- will result in the cutting of 570 jobs from the work force of Reynolds American and R.J. Reynolds in Winston-Salem, N.C. The company will also review the value of the Kool trademark, which could result in a write-down for the current quarter.
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