NEW YORK — Investors who have been salivating at the prospect of an Altria Group Inc. breakup may not have much longer to wait now that a federal judge has handed down a much-anticipated racketeering decision.
"OK, now pop the cork!" analyst Christopher Growe of A.G. Edwards & Sons wrote in a research note Friday. Citigroup Inc. analyst Bonnie Herzog wrote in her note, "Get ready for Altria to move the cheese," in reference to its long-planned spinoff of Kraft Foods Inc. Christine Farkas of Merrill Lynch & Co. wrote, "The date for Altria's restructuring has very likely been accelerated."
A decision issued after the market closed Thursday removed a legal cloud that had been hanging over the industry. It also removed a great deal of the uncertainty that had been holding back the breakup of the world's largest cigarette maker.
U.S. District Judge Gladys Kessler ruled that tobacco companies deceived smokers about the health hazards of smoking, but she said she did not have the ability to award substantial financial penalties. The Justice Department had sued tobacco companies, seeking $14 billion in funding for smoking cessation and education campaigns.