Globe House, British American Tobacco's London headquarters
uk bat.com - Recent past: 1969 - now
By 1970, British American Tobacco has operations in 50 countries.
Diversification with the creation of BAT Industries in the late 1970s and the expansion into financial services in the 1980s gives way by 1989 to a re-focus on the tobacco business.
Acquisition
By 1970, under new Chairman Richard Dobson, British American Tobacco companies are manufacturing in 140 factories across 50 countries. Two years later, with the revocation of its 1902 agreement with Imperial, it gains exclusive ownership of its original brands, including State Express, in the UK and Western Europe.
In the company’s quest for another significant business, British American Tobacco finally settles on retailing where acquisition in the seventies includes Argos in the UK and Saks Fifth Avenue in the United States.
In 1976, the Group undergoes radical reorganisation. With a new Chairman, Peter Macadam, operations are coordinated under a new holding company, B.A.T Industries. Within two years, Industries is the UK’s third largest company and the largest tobacco manufacturer in the free world with annual sales of 500 billion cigarettes.
As the company celebrates its 75th anniversary in 1977, Macadam comments:
“We have survived two world wars, the loss of our China business, [and] dispossession in numerous places elsewhere…and we have come through stronger and, I believe, better poised today than we have ever been.”
Meanwhile, Brown & Williamson opens its new US$150 million factory in Macon, Georgia. By the end of the decade, British American Tobacco exports the first batch of cigarettes to China since the nationalisation of its operations there 30 years before.
By the end of the decade, with its acquisition of Lorillard’s international business, the Group acquires several more key brands, including Kent.
Re-focus
By 1981, trading profits from the tobacco operations have tripled over the previous decade to more than £463 million as production capacity steadily increases.
With the acquisition of Eagle Star in 1984, Allied Dunbar the following year, and the Farmers Group in 1988, BAT Industries is by 1989 the largest UK-based insurance group. The same year, with a 24 per cent pre-tax profit increase to more than £2 billion and confronted by a hostile takeover bid, BAT Industries decides to re-focus exclusively on tobacco and financial services and dispose of almost everything else.
New opportunities
In the 1990s, economic liberalisation and the break-up of state monopolies open up new trading opportunities in Central and Eastern Europe and the Far East. British American Tobacco acquires Hungary’s Pecsi Dohanygyar in 1992. Acquisitions and joint ventures follow rapidly in Ukraine, Uzbekistan, the Czech Republic, Russia, Romania and Poland.
Another significant acquisition is that of the American Tobacco Company in 1994, giving British American Tobacco ownership of the Lucky Strike and Pall Mall brands.
Returning to its roots
In 1998, BAT Industries divests its financial services businesses. That same year the company acquires Cigarrera La Moderna, the leading cigarette company in Mexico.
In 1998, British American Tobacco p.l.c. becomes a separately quoted company on the London Stock Exchange, with Martin Broughton as its chairman. In 1999, British American Tobacco, the second largest tobacco company, announces a global merger with Rothmans International, the fourth largest. With the merger, British American Tobacco adds to its portfolio several major brands, including Dunhill.
Into the new millennium
The merger with Rothmans is followed by a major change to the Group’s interests in the Canadian market, now the largest generator of profit for the Group. During 2000, Rothmans' Canadian interests are sold, while the outstanding shares in Imasco, an associate of British American Tobacco, are purchased and its non-tobacco interests are sold. Now a wholly-owned subsidiary focused solely on tobacco, the Canadian operation is known as Imperial Tobacco Canada.
In 2001, the Group announces a series of new investments in countries such as Turkey, Egypt, Vietnam, South Korea and Nigeria.
British American Tobacco celebrates its centenary in 2002. It reaffirms its faith in its people, its products and the tobacco industry as a whole with new investments in Nigeria, South Korea and Turkey. That same year, it becomes the first tobacco company to publish a Social Report.
The following year British American Tobacco gains control of Peru’s Tabacalera Nacional and wins bids for Italy’s former state tobacco monopoly, ETI, and Serbia’s Duvanska Industrija Vranje. It also announces proposals to combine the US business of Brown & Williamson, its US subsidiary, with RJ Reynolds Tobacco Company.
In November 2003 Martin Broughton discloses that he plans to retire from British American Tobacco at the end of June 2004 after 10 years leading the Group as Chief Executive and, for the last five, as Chairman.
Paul Adams takes over as Chief Executive of the Group in July 2004, with Jan du Plessis as Non-Executive Chairman.
In 2004 the US business of Brown & Williamson and RJ Reynolds Tobacco Company are combined and Reynolds American is formed – a stronger, more sustainable business in which British American Tobacco has a 42% share.
In 2005 British American Tobacco trials Swedish-style snus in Sweden and South Africa, giving smokers the chance to enjoy a less harmful form of tobacco, without lighting up.
The number of snus outlets in the two countries extends in 2006. The year also sees the sale of the Toscano cigar business in Italy. In October the Group exits Formula One motorsport sponsorship - a long-standing commitment consistent with the International Marketing Standards subscribed to in 2001.
2007 sees snus test marketing extended to Canada and the sale of a number of our pipe tobacco trademarks to Danish company Orlik Tobacco Company. In May we sell our Belgian cigar factory and associated brands to the cigars division of Skandinavisk Tobakskompagni.
Acquisitions come to the fore in 2008 with our winning US$1.72 billion bid for the assets of Tekel, the Turkish state tobacco company. It is quickly followed by a deal to acquire the cigarette and snus businesses of Skandinavisk Tobakskompagni.
2009 sees another deal concluded: the approx. US$580 million acquisition of Bentoel, Indonesia's fourth largest kretek cigarette maker. Kreteks are made from tobacco and cloves.
Richard Burrows takes over as Chairman of British American Tobacco p.l.c. in November 2009.
At the end of February 2011, Paul Adams ends 20 years with British American Tobacco, including seven years as Chief Executive. Nicandro Durante takes over as Chief Executive of the Group in March 2011.
April sees the establishment of Nicoventures Limited, a stand-alone company to focus exclusively on the development and commercialisation of innovative, regulatory approved nicotine products that will offer consumers much of the experience they expect to get from a cigarette but without the real and serious health risks of smoking.
2011 concluded with the US$452 million acquisition of Protabaco in Colombia.
December 2012 saw the acquisition of CN Creative, a UK-based company that specialises in the development of electronic cigarette (e-cigarette) technologies intended to offer smokers a less risky alternative to cigarettes.
