TIDMBATS

RNS Number : 6792O

British American Tobacco PLC

01 June 2015

1 June 2015

British American Tobacco to acquire TDR

British American Tobacco to expand its business in Central Europe

British American Tobacco ("BAT") has signed an agreement to acquire TDR d.o.o. and other tobacco and retail assets ("TDR") from Adris Grupa d.d. ("Adris") for a total enterprise value of EUR550 million.

TDR is the leading independent cigarette manufacturer in Central Europe with a market leading position in Croatia and a position of scale in Bosnia and Serbia which will provide BAT with the opportunity to significantly grow its business in the region.

By combining its existing business in the region together with TDR, BAT expects to benefit from highly skilled people, well established brands, enhanced regional leaf processing capabilities, a local high quality factory and print facility and strong relationships with distributors and retailers in these markets.

As part of the transaction BAT has committed to keeping TDR's manufacturing facility in Kanfanar, Croatia operational for at least five years following completion of the acquisition.

The transaction represents a multiple of approximately 12.5 times (based on TDR's financial year ending 31 December 2014 EBITDA of approximately EUR44 million).

Nicandro Durante, BAT's Chief Executive, commented: "This is an exciting acquisition for BAT, which will provide immediate scale in three core markets of Croatia, Bosnia and Serbia and establishes a sustainable platform to grow our business in Central Europe".

The proposed acquisition is subject to a number of anti-trust approvals and Adris shareholder consent. The transaction is expected to complete in October 2015.

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