Looking over this morning's coverage of British American Tobacco's recent figures, I see a couple of newspaper reporters tried to tempt Nicandro Durante, CEO of BAT, into spilling the beans about whether the tobacco giant has any plans to consolidate its position in the US.
BAT has opted to stump up $4.7 billion to keep its stake in Reynolds American at 42pc while it merges with rival Lorillard as part of $50 billion plus mega merger.
Mr Durante told the Financial Times "we do not have any plans to raise our stake above 42pc" while Dominic Walsh over the The Times asked Mr Durante whether he felt further consolidation was possible among the big tobacco groups. Mr Durante's response was "I don't have any expectation of that".
Some readers might recall I have followed this situation quite closely for the last six months or so.
My understanding is that since last year BAT studied with its advisers at Deutsche Bank and UBS the various consolidation options, including buying Reynolds American or Lorillard. Here is a link to a piece in the The Times I wrote a couple of months ago on the topic:
http://www.thetimes.co.uk/tto/business/industries/consumer/article4086903.ece
However, after Reynolds American began talking to Lorillard about a merger, BAT's opted to effectively sit on the sidelines until the merger completes by paying $4.7 billion to keep its stake in the newly merged company at 42pc.
Once, though, the Reynolds American/Lorillard deal is done and the various disposals completed, I wouldn't rule out BAT coming back for the newly merged group in the next couple of years. At least, that is what my sources have told me is likely to happen.
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