British American Tobacco Unit, Imperial Tobacco Canada To Settle With Flintkote

(RTTNews) - Imperial Tobacco Group Plc (IMT.L, ITYBY.PK) has inked a deal in principle with The Flintkote Co., a U.S. company formerly engaged in the production and sale of asbestos-containing products, for $575 million for claims regarding certain disputed dividends and existing and potential asbestos claims. The Flintkote case, a legacy litigation that began in 2006, is completely irrelevant to Imperial Tobacco Canada's tobacco activities.

The asbestos company, Flintkote, was an unit of Genstar Corp., which was later purchased by Imperial Tobacco's corporate predecessor, Imasco Ltd., in 1986. It is therefore a former indirect corporate subsidiary of Imperial Tobacco. The 2006 litigation sought recovery from Imperial Tobacco Canada of certain dividends and other transfers received in 1986 and 1987 after Imasco acquired Genstar Corp. Also, the litigation seeks to hold Imperial Tobacco liable for Flintkote's asbestos liabilities.

This agreement in principle of the dividend claims and the asbestos related liabilities, brings this long running litigation to an end. According to the proposed settlement, Imperial Tobacco would obtain protection from current and potential future Flintkote related asbestos liability claims in the U.S.