Loews spins off cigarette division via exchange offer; Lorillard begins trading on NYSE

By Lisa Kerner

Charlotte, N.C., June 10 - Loews Corp. said a total of 173,449,763 shares of its common stock were tendered in exchange for shares of common stock of its subsidiary, Lorillard, Inc.

In December, Loews announced it would spin off its interest in Lorillard to holders of its Carolina Group stock and Loews common stock in a tax-free transaction.

The exchange offer ended at midnight on June 9, according to a Loews news release.

Mellon Investor Services LLC, the exchange agent for the offer, said the total number of shares exchanged included 76,032,420 shares tendered by guaranteed delivery procedures.

Loews will accept 93,492,857 shares of Loews common stock in exchange for 65,445,000 shares of Lorillard common stock, reflecting an exchange ratio of 0.7.

Because the offer is oversubscribed, Loews is able to accept only a portion of shares that were validly tendered on a pro rata basis in proportion to the number of shares tendered, the release stated.

Loews said it expects that approximately 53.5% of the tendered Loews common stock will be accepted for exchange.

The final proration factor will be announced.

Lehman Brothers Inc. and Morgan Stanley & Co. Inc. were co-dealer managers for the exchange offer.

Loews also announced that it is redeeming all 108,478,429 outstanding shares of its Carolina Group stock in exchange for 108,478,429 shares of Lorillard common stock, or approximately 62% of Lorillard's outstanding common stock.

According to the news release, holders of Carolina Group stock received one share of Lorillard common stock for each share of Carolina Group stock they owned.

Shares of Lorillard common stock will begin trading Tuesday on the New York Stock Exchange under the symbol "LO."

"As an independent company we are now able to more effectively pursue our growth strategy and opportunities unique to our markets," Lorillard chairman, president and chief executive officer Martin Orlowsky said in the release.

Loews is a New York-based energy, financial services and tobacco conglomerate.

Lorillard, through its subsidiaries, produces and sells cigarettes under brand names including Newport, Kent and Old Gold.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.