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• BAT to Acquire Most of Denmark's ST for $4.1 Billion (Update3) 

British American Tobacco Plc, the maker of Lucky Strikes, agreed to buy most of Skandinavisk Tobakskompagni A/S for $4.1 billion, gaining 60 percent of the market for cigarettes in Scandinavia.

BAT said today it will pay 20.3 billion Danish kroner for ST units including Prince cigarettes and Fiedler & Lundgren, the Swedish maker of snus powdered tobacco. London-based BAT already owned 32 percent of Soeborg, Denmark-based ST.

The takeover of ST, whose roots date back 258 years, will save BAT 60 million pounds annually by 2011 and give the company a bigger foothold in the $2 billion-plus market for snus. It's the second purchase unveiled by BAT this month, following last week's $1.72 billion bid for Turkey's Tekel. At least $42 billion of tobacco mergers in a year have reduced competition, allowing price increases in a shrinking European cigarette market.

ST gives BAT ``a leading and profitable market share in Scandinavia,'' said Bruce Davidson, an analyst at Blue Oar Securities in London. ``It's almost always better to hold 100 percent of a business than 32 percent. Snus is a useful by- product of the deal.''

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