BAT share price: Company settles legal dispute with Flintkote

on Dec 19, 2014
Updated: Oct 21, 2019
Listen, Friday, December 19: British American Tobacco Group Plc (LON:BATS) has reached an agreement with the Flintkote Company over a long-running legal dispute. In a statement to the London Stock Exchange today, the UK tobacco giant said that its Canadian subsidiary, Imperial Tobacco Canada, had agreed to pay $575 million to settle the litigation related to disputed dividends and existing and potential asbestos claims.

The litigation started in 2006, when Flintkote, a US company that formerly sold asbestos-containing products, sued Imperial Tobacco Canada over issues dating back to 1986 and 1987. Back then the US firm became an indirect corporate subsidiary of Imperial Tobacco’s corporate predecessor, following the1986 acquisition of its parent company Genstar Corporation. Flintkote sought recovery from Imperial Tobacco of certain dividends and other transfers received in 1986 and 1987, BAT explained, adding that “The litigation also seeks to hold Imperial Tobacco liable for Flintkote’s asbestos liabilities.”

“Today’s agreement in principle of the dividend claims and the asbestos related liabilities, brings this long running litigation to an end,” British American said in the statement. The company noted that the agreement would provide protection for the Canadian unit from“current and potential future Flintkote-related asbestos-liability claims in the United States”.
In today’s trading, BAT shares were up 0.4 percent at 3,462.50p, as of 08:11 UTC. The company’s shares have risen nearly seven percent since the start of the year.
According to the Financial Times, the 16 analysts offering 12 month price targets for British American Tobacco plc have a median target of 3,735p, with a high estimate of 4,233p and a low estimate of 2,800p. As of Dec 12, 2014, the consensus forecast amongst 33 polled investment analysts covering BAT suggests that investors should hold their position in the company.
As of 10:23 GMT, Friday, 19 December, British American Tobacco plc share price is 3,445.25p.

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