Imperial bid for Reemtsma?

?Imperial Tobacco International will launch a $5.7bn bid for German tobacco rival Reemtsma, according to media reports. If successful, Imperial could challenge the market leadership of the three leading tobacco companies, Philip Morris, Japan Tobacco International (JTI) and British American Tobacco (BAT).

The reports follow comments from Imperial chairman Gareth Davis that the group is looking to build its presence in international markets.  Forty-six percent of Imperial's profits came from overseas business this year, and Davis said last week that he intended to increase that figure to 75%, although he refused to comment on the Reemtsma sale.
Imperial could be well-placed to launch a bid. Philip Morris and BAT may struggle to bid for the world's fourth-largest cigarette manufacturer due to anti-trust authorities, while Altadis and JTI are consolidating their operations amid worsening economic conditions. Imperial, on the other hand, reported a big rise in annual profits last week, boosted by strong growth overseas.

Merrill Lynch is handling the Reemtsma sale, by parent group German coffee and catering business Tchibo, which owns a 75% stake in the company. The company made sales of Eu2.6bn ($2.3bn) last year, and key brands in duty-free include West and Davidoff.