Reynolds to Consolidate E-Cigarette Production in North Carolina
September 30 2015 - 6:10PM
Dow Jones News
Reynolds American Inc. said it is consolidating production of
its Vuse electronic cigarettes at its Tobaccoville, N.C., plant,
where it recently completed a multimillion-dollar upgrade of its
e-cigarette manufacturing equipment.
Winston-Salem, N.C.-based Reynolds, the maker of Camel and Pall
Mall cigarettes, said it expects to post roughly $100 million in
asset write-downs and exit charges for the third quarter as a
result of the move.
Production of certain cartridges for the digital vapor
cigarettes had been done by a contractor's facility in Kansas, but
starting Wednesday all Vuse production will be at the North
Carolina plant.
The move comes a day after Japan Tobacco Inc. said Tuesday it
would buy non-U.S. rights to the Natural American Spirit cigarette
brand from Reynolds for about $5 billion. The deal is designed to
expand Tokyo-based Japan Tobacco's reach beyond the shrinking
Japanese market and reduce Reynolds's debt following its $25
billion acquisition of Lorillard Inc. in June.
Reynolds completed its the national rollout of its Vuse
electronic cigarette in April. However in late July Chief Executive
Susan Cameron said the company no longer expected its e-cigarette
brand Vuse to be profitable during the third quarter.
Write to Tess Stynes at tess.stynes@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
September 30, 2015 17:55 ET (21:55 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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