Imperial Tobacco Canada Files For Protection Under CCAA - Quick Facts

(RTTNews) - British American Tobacco plc (BATS.L, BTI) announced it has been informed by its Canadian subsidiary, Imperial Tobacco Canada Ltd (ITCAN), that ITCAN has obtained an Initial Order from the Ontario Superior Court of Justice granting it protection under the Companies' Creditors Arrangement Act, or CCAA. This has the effect of staying all current tobacco litigation in Canada against ITCAN and other Group companies.

The Group said, in seeking protection under the CCAA, ITCAN will look to resolve not only the Quebec case but also all other tobacco litigation in Canada under an efficient and court supervised process, while continuing to trade in the normal course. Following the upholding of the Quebec Superior Court's judgment on 1 March 2019, ITCAN's share of the judgment is a maximum of approximately C$9.2 billion.

A British American Tobacco spokesperson said: "Imperial Tobacco Canada has informed us that it disagrees with the Court's judgment. However, we understand that CCAA protection will provide Imperial Tobacco Canada an opportunity to settle all of its outstanding tobacco litigation under an efficient and court supervised process whilst continuing to run its business in the normal course."

The Group said it will continue to consolidate the results of ITCAN, in line with IFRS 10 "Consolidated Financial Statements", and ITCAN's CCAA filing will not negatively affect the Group's adjusted net debt to adjusted EBITDA ratio. There will be no impact on the BAT Group's dividend payments or policy, the Group noted.