Loews Corp. (NYSE: LTR) just split out Lorillard Inc., which will trade under the ticker LO. Standard & Poors has announced that it will make Lorillard the newest member of the S&P 500, dropping Ambac (NYSE: ABK) from the index. (I mentioned this in early January when I posted Chasing Value: Loews Corp. has all the right pieces making it one of stock picks for 2008; for the latest on that, see Chasing Value: 8 stocks for 2008 -- May beats all).
The transaction will close as of trading on Tuesday, June 10. Lorillard is being distributed to the public via a two-tier process involving: 1) the retirement of the tracking stock Carolina Group (NYSE: CG), in exchange for which approximately 62% of Lorillard's common stock will be issued, and 2) an offer in which shares of S&P 500 constituent Loews Corp. can be exchanged for the remaining shares of Lorillard
It was a smart move by Loews company management to separate the tobacco company from its other interests in hospitality, oil exploration, real estate and insurance.
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