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Press release from PR Newswire

Block & Leviton LLP Investigates Lorillard Inc. for Possible Breaches of Fiduciary Duty in Connection with Its Merger with Reynolds American Inc.

Tuesday, July 15, 2014

Block & Leviton LLP Investigates Lorillard Inc. for Possible Breaches of Fiduciary Duty in Connection with Its Merger with Reynolds American Inc.

10:07 EDT Tuesday, July 15, 2014

BOSTON, July 15, 2014 /PRNewswire/ -- Block & Leviton LLP (, a Boston-based law firm representing investors nationwide, has commenced an investigation into possible breaches of fiduciary duty by the Board of Directors of Lorillard Inc. ("Lorillard" or the "Company") (NYSE: LO) concerning its proposed merger with Reynolds American Inc. ("Reynolds") in a cash and stock transaction.

Lorillard stockholders will receive $50.50 in cash and 0.2909 shares of Reynolds common stock for each Lorillard share held, currently valued at $68.88 per share.  This represents a premium of barely 2% of Lorillard's closing price on July 14, 2014, when it reached its 52-week high.  The total value of the deal is approximately $27 billion.  The companies have yet to announce whether the merger is subject to a price collar, which would protect Lorillard shareholders from a drop in Reynolds' trading price.

Following the merger, Reynolds will sell its Kool and Salem brands, and the Lorillard blu eCigs brand, to Imperial Tobacco.  This move is required to minimize antitrust concerns, and divests valuable assets, as eCigs is the single largest brand on the e-cigarette market, with a 50% market share.  British American Tobacco ("BAT"), Reynolds' largest shareholder, has already agreed to support the merger and will reap valuable future rewards from its approval.  BAT will continue to own over 40% of the combined company, while Lorillard shareholders will own just 15%.

Block & Leviton's investigation seeks to determine, among other things, whether Lorillard's Directors breached their fiduciary duties by failing to maximize shareholder value in the proposed merger with Reynolds and the fairness of the process by which they considered the transaction.  The firm is also investigating whether or not Reynolds' (NYSE: RAI) officers and board members aided and abetted such breaches of fiduciary duty.

If you are a shareholder of Lorillard Corporation and have questions about your legal rights, or if you have information relevant to this investigation, please contact attorney Steven P. Harte, at (617) 398-5600 or email him at   

Block & Leviton is a Boston-based law firm representing investors nationwide for violations of securities laws.  The firm's lawyers have collectively been prosecuting securities cases on behalf of investors for over 70 years.  This notice may constitute attorney advertising.

Contact: BLOCK & LEVITON LLP Steven P. Harte, Esq. (617) 398-5600

SOURCE Block & Leviton LLP

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