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����̽�� to expand its business in Central Europe

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����̽�� (“BAT”) has signed an agreement to acquire TDR d.o.o. and other tobacco and retail assets (“TDR”) from Adris Grupa d.d. (“Adris”) for a total enterprise value of €550 million.��

TDR is the leading independent cigarette manufacturer in Central Europe with a market leading position in Croatia and a position of scale in Bosnia and Serbia which will provide ����̽��with the opportunity to significantly grow its business in the region.

By combining its existing business in the region together with TDR, ����̽��expects to benefit from highly skilled people, well established brands, enhanced regional leaf processing capabilities, a local high quality factory and print facility and strong relationships with distributors and retailers in these markets.

As part of the transaction ����̽��has committed to keeping TDR’s manufacturing facility in Kanfanar, Croatia operational for at least five years following completion of the acquisition.����

The transaction represents a multiple of approximately 12.5 times (based on TDR’s financial year ending 31 December 2014 EBITDA of approximately €44 million).

Nicandro Durante, BAT’s Chief Executive, commented:��“This is an exciting acquisition for BAT, which will provide immediate scale in three core markets of Croatia, Bosnia and Serbia and establishes a sustainable platform to grow our business in Central Europe”.

The proposed acquisition is subject to a number of anti-trust approvals and Adris shareholder consent. The transaction is expected to complete in October 2015.

Enquiries

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����̽�� Press Office
Will Hill / Anna Vickerstaff
+44 (0) 20 7845 2888 (24 hours)�� |��

Investor Relations
Mike Nightingale��/ Rachael Brierley
+44 (0) 20 7845��1180 /��1519

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NOTES TO EDITORS

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����̽�� is the world's second largest quoted tobacco group by global market share, with brands sold in more than 200 markets.��We have five Global Drive Brands - Dunhill, Kent, Lucky Strike, Pall Mall and Rothmans - and over 200 brands in our portfolio.��We hold robust market positions in each of our regions and have leadership positions in more than 60 markets.

����̽��is being advised by Baker & McKenzie and EY in relation to the transaction.