NEW YORK (TheStreet) -- Shares of Lorillard (LO) are increasing 1.14% to $72.95 in Wednesday's midday trading after the FTC yesterday cleared tobacco company Reynolds American (RAI) to buy Lorrillard for $27.4 billion.
Shares of Reynolds American are climbing 2.51% to $77.32.
The two cigarette makers announced their planned marriage last July, part of a three-way deal in which the companies agreed to sell $7.1 billion in cigarette brands and other assets to UK-based Imperial Tobacco Group (ITYBY) according to The Wall Street Journal.
By acquiring Lorillard, Reynolds' market share would be boosted to 34%. Meanwhile, Marlboro leads the pack with an estimated 47% of the share.
The Lorillard-Reynolds deal will reshape and further consolidate the tobacco industry, the Journal added.
Lorillard is the maker of Newport cigarettes and Reynolds is the maker of Camel and Pall Mall cigarettes.
TheStreet Ratings team rates LORILLARD INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate LORILLARD INC (LO) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, good cash flow from operations, solid stock price performance and increase in net income. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."