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Press release from Business Wire

Altria Announces Early Tender Results of Debt Tender Offer

Monday, August 20, 2012

Altria Announces Early Tender Results of Debt Tender Offer08:45 EDT Monday, August 20, 2012 RICHMOND, Va. (Business Wire) -- Altria Group, Inc. (Altria) (NYSE: MO) today announced the preliminary results for its previously announced cash tender offer for up to $2,000,000,000 aggregate principal amount (the “Tender Cap”) of its senior unsecured notes identified in the table below (the “Notes”). The terms and conditions of the tender offer are described in the Offer to Purchase, dated August 6, 2012, and the related Letter of Transmittal. According to information provided by Global Bondholder Services Corporation, the Depositary and Information Agent for the tender offer, $1,734,101,000 aggregate principal amount of the 9.700% Notes due 2018, $1,282,485,000 aggregate principal amount of the 9.250% Notes due 2019, $283,917,000 aggregate principal amount of the 9.950% Notes due 2038 and $404,998,000 aggregate principal amount of the 10.200% Notes due 2039 were validly tendered and not validly withdrawn at or prior to 5:00 p.m., New York City time, on August 17, 2012 (the “Early Tender Deadline”). Tendered Notes may not be withdrawn after the Early Tender Deadline. The total aggregate principal amount of Notes validly tendered and not validly withdrawn at or prior to the Early Tender Deadline was $3,705,501,000, which amount exceeds the Tender Cap. Since Altria will accept for payment only such portion of the tendered Notes that does not result in it purchasing Notes with an aggregate principal amount above the Tender Cap, Altria will purchase a portion of the validly tendered Notes with Acceptance Priority Level 1 and will not purchase any Notes with Acceptance Priority Level 2, in accordance with the terms of the tender offer set forth in the Offer to Purchase. Assuming that the conditions to the tender offer are satisfied or waived, tendered Notes with Acceptance Priority Level 1 will be accepted for purchase on a prorated basis as described in the Offer to Purchase, such that the aggregate principal amount of the Notes accepted in the tender offer equals the Tender Cap.   The tender offer for the Notes will expire at 12:00 midnight, New York City time, on Friday, August 31, 2012, unless extended or earlier terminated by Altria.                                                                                           Aggregate                         AcceptanceMaximumEarlyU.S. TreasuryFixedBloombergTitle ofCUSIPOutstandingPriorityPurchaseTenderReferenceSpreadReferenceSecurities       Number       Principal Amount       Level       Sublimit*       Payment**       Security       (bps)       Page 9.700% Notesdue 2018 02209SAD5 $3,100,000,000 $30 0.500% dueJuly 31, 2017 135 FIT1 1 Not Applicable 9.250% Notesdue 2019       02209SAJ2       $2,200,000,000                       $30       1.750% dueMay 15, 2022       80       FIT1 9.950% Notesdue 2038 02209SAE3 $1,500,000,000 $30 3.125% dueFebruary 15, 2042 235 FIT1 2 $500,000,000 10.200% Notesdue 2039       02209SAH6       $1,500,000,000                       $30       3.125% dueFebruary 15, 2042       240       FIT1 *Applies to the aggregate principal amount of Notes with Acceptance Priority Level 2. **Per $1,000 principal amount of Notes validly tendered and not validly withdrawn at or prior to the Early Tender Deadline and accepted for purchase.   For Notes that were validly tendered and not validly withdrawn at or prior to the Early Tender Deadline and accepted for purchase, the applicable total consideration per $1,000 principal amount of each series of Notes (for each series, the “Total Consideration”) will be a price determined as described in the Offer to Purchase intended to result in a yield to maturity (calculated in accordance with standard market practice) equal to the sum of (i) the yield to maturity for the applicable U.S. Treasury Reference Security specified in the table above, calculated based on the bid-side price of such U.S. Treasury Reference Security as of 11:00 a.m., New York City time, today, August 20, 2012 (being the first business day following the Early Tender Deadline), plus (ii) the applicable Fixed Spread specified in the table above. The Total Consideration includes the Early Tender Payment specified in the table above. Holders tendering their Notes after the Early Tender Deadline and at or prior to the Expiration Date will be eligible to receive only the applicable tender offer consideration, namely the applicable Total Consideration less the Early Tender Payment specified in the table above. In addition, holders whose Notes are purchased in the tender offer will be paid accrued and unpaid interest on their purchased Notes from the applicable last interest payment date up to, but not including, the payment date for such purchased Notes. On August 9, 2012, Altria completed an underwritten public offering of senior unsecured notes in an aggregate principal amount sufficient to satisfy the financing condition described in the Offer to Purchase. The tender offer is subject to the satisfaction or waiver of certain other conditions, as specified in the Offer to Purchase. Citigroup Global Markets Inc., J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC are acting as the lead dealer managers for the tender offer. Investors with questions may contact Citigroup Global Markets Inc. at (800) 558-3745 (toll-free) or (212) 723-6106 (collect) and J.P. Morgan Securities LLC at (866) 834-4666 (toll-free) or (212) 834-2494 (collect). Global Bondholder Services Corporation is the Information Agent and Depositary and can be contacted at the following numbers: banks and brokers can call (212) 430-3774 (collect), and all others can call (866) 387-1500 (toll-free). This press release is neither an offer to sell nor a solicitation of offers to buy any securities. The tender offer is being made only pursuant to the Offer to Purchase and the related Letter of Transmittal. The tender offer is not being made to holders of Notes in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction. None of Altria, the Dealer Managers, the Depositary, the Information Agent, or the trustee for the Notes makes any recommendation in connection with the tender offer. Please refer to the Offer to Purchase and related Letter of Transmittal for a description of offer terms, conditions, disclaimers, and other information applicable to the tender offer. Altria's Profile Altria directly or indirectly owns 100% of each of Philip Morris USA Inc. (PM USA), U.S. Smokeless Tobacco Company LLC (USSTC), John Middleton Co. (Middleton), Ste. Michelle Wine Estates Ltd. (Ste. Michelle) and Philip Morris Capital Corporation. Altria holds a continuing economic and voting interest in SABMiller. The brand portfolios of Altria's tobacco operating companies include such well-known names as Marlboro, Copenhagen, Skoal and Black & Mild. Ste. Michelle produces and markets premium wines sold under various labels, including Chateau Ste. Michelle, Columbia Crest and Stag's Leap Wine Cellars, and it exclusively distributes and markets Antinori, Champagne Nicolas Feuillatte and Villa Maria Estate products in the United States. Trademarks and service marks related to Altria referenced in this release are the property of, or licensed by, Altria or its subsidiaries. More information about Altria is available at altria.com. Altria Client ServicesInvestor Relations804-484-8222orAltria Client ServicesMedia Relations804-484-8897