Altria’s next move: Sell Kraft?
TEXT OF STORY
SCOTT JAGOW: The main reason the Dow had such a good day was the good fortune for Altria. That’s the big tobacco company that also owns Kraft foods. Yesterday, Florida’s Supreme Court threw out the $145 billion dollar punishment from a smokers’ lawsuit. As Marketplace’s Lisa Napoli tells us, this could open a door for Altria.
LISA NAPOLI: Oreos, Velveeta, Planter’s Peanuts — they could all go up in smoke someday.
Altria’s executives have long said once tobacco litigation was finished, it would spin off its mammoth Kraft Foods.
Editor in Chief Bob Teitelman of The Deal says in preparation for that day, the food giant’s been slimming down, offloading brands like Milk Bones and Life Savers.
BOB TEITELMAN: The market wants these companies to be a little smaller and more efficient than they used to be.
The promised spin-off would mean the distribution of close to a billion and a half shares to Altria stakeholders.
And Teitelman says, a boost in Kraft’s value:
TEITELMAN: You can have the greatest company in the world and it can be attached to a tobacco company and it’s going to drag that stock down.
Analysts say don’t look for any movement until next year. Altria’s still hoping other litigation gets snuffed out.
I’m Lisa Napoli for Marketplace.
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