BAT moves closer to settling tobacco litigation in Canada
British American Tobacco has announced that it is nearing a potential settlement regarding outstanding tobacco litigation in Canada after a five-year-long legal process involving its subsidiary Imperial Tobacco Canada Limited (ITCAN).
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Back in 2019, ITCAN obtained creditor protection under the Canadian Companies' Creditors Arrangement Act or CCAA, and has been negotiating a possible settlement in a confidential court supervised mediation process.
BAT said on Friday that the mediator and monitor are now planning for "compromise and arrangement", which has been filed in the Ontario Superior Court of Justice.
ITCAN said in a statement that this was an "important step towards a potential settlement", but didn't disclose any financial details.
"The plan resolves all Canadian tobacco litigation and provides a full and comprehensive release to Imperial, BAT and all related entities for all tobacco claims. This settlement will be funded by the cash on hand and the cash generated from the future sale of tobacco products in Canada while at the same time maximizing recovery for the creditors. It also allows the Canadian tobacco companies to continue operating as a going concern for the benefit of all stakeholders."
A BAT spokesperson said the company is "hopeful of a quick conclusion".