Philip Morris takes over Rothmans

Tobacco giant Philip Morris (PMI) has announced plans to take over rival Rothmans, the maker of Benson and Hedges cigarettes.

The C$2bn ($1.95bn; £980m) deal involves Philip Morris buying the 60% of Rothmans to add to the 40% it already owns.

Rothmans' shares rose, while Philip Morris' share price fell on the news.

PMI also said Rothmans had paid a C$550m settlement in connection with an inquiry into tobacco smuggling.

The investigation by Royal Canadian Mounted Police related to incidences between 1989 and 1994 when tobacco was exported from Canada then smuggled back into the country from the United States to avoid higher taxes.

Rothmans and Imperial Tobacco had admitted a charge of "aiding persons to sell and be in possession of tobacco manufactured in Canada that was not packed and was not stamped in conformity with the Excise Act and its amendments and ministerial regulations".