Reynolds (RAI) Receives Blessing from BATS to Acquire Lorillard (LO)

Lorillard (NYSE: LO) is active Friday morning on word that Reynolds American (NYSE: RAI) is nearing a deal to acquire the company.

Bloomberg reported earlier that the deal is closer than ever after British American Tobacco Plc, (BATS), which owns 42 percent of Reynolds, approved the deal.

Sources caution that the deal is complicated -- involving several parties -- and nothing is set in stone yet.

Under the deal, Imperial Tobacco Group Plc (IMT) would need to acquire some brands from Reynolds and Lorillard to stem antitrust issues that might appear with U.S. regulators. IWT is said to be lining up around $7 billion in financing.

Lorillard last had a market value of about $23 billion. The stock is up over 5 percent early.

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