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• Altria, PMI May Offer to Buy Imperial, Lehman Says (Update3) 

Altria Group Inc. and Philip Morris International Inc. may bid for Imperial Tobacco Group Plc, Europe's second-largest cigarette maker, with a view to breaking up the company, Lehman Brothers Holdings Inc. said.

Altria's Philip Morris USA unit and PMI are a ``potential suitor'' for Bristol, England-based Imperial, David Hayes, an analyst at Lehman in London, wrote today in a research report. He resumed coverage of Imperial with an ``overweight'' rating.

A takeover would be a ``final round of consolidation'' in the tobacco industry, according to Hayes. Imperial, which bought Gauloises cigarettes maker Altadis SA this year, might be split between the two companies, he said. Imperial Chief Financial Officer Bob Dyrbus said in a presentation to investors today that further industry consolidation ``seems unlikely.''

``A solution that could create value for PMI is working with Philip Morris USA to carve up the newly enlarged Imperial- Altadis,'' Hayes wrote in the report.

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