Acquisition of NJOY (Tables)

9 Months Ended

Sep. 30, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

Summary of Costs Incurred

Costs incurred for the NJOY Transaction are recognized as expenses in the period in which the costs are incurred and are included in our condensed consolidated statement of earnings as follows:

	For the Nine Months Ended September 30,				For the Three Months Ended September 30,
(in millions)	2024		2023		2024		2023
Marketing, administration and research costs:
Change in fair value of contingent payments	$	140	$	—	$	—	$	—
Other costs (1)	47		54		44		13
Interest and other debt expense, net:
Financing fees	—		9		—		1
Total NJOY Transaction costs	$	187	$	63	$	44	$	14

(1) For the nine and three months ended September 30, 2024, substantially all of these costs were acquisition-related costs associated with patent infringement lawsuits related to the NJOY Transaction. For further discussion of the patent infringement lawsuits, see Note 14. Contingencies. For the nine months ended September 30, 2023, substantially all of these costs were acquisition-related costs, consisting primarily of transaction costs.

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The amounts in the table below represent the final purchase price allocation to the assets acquired and

liabilities assumed in the NJOY Transaction, including measurement period adjustments made during the three months ended March 31, 2024.

(in millions)	Preliminary Purchase Price Allocation		Measurement Period Adjustments		Final Purchase Price Allocation
Cash and cash equivalents	$	22	$	—	$	22
Receivables	7		—		7
Inventories	19		—		19
Other assets	7		—		7
Property, plant and equipment	16		—		16
Other intangible assets:
Developed technology (amortizable)	1,000		—		1,000
Trademarks (amortizable)	230		(40)		190
Supplier agreements (amortizable)	180		(180)		—
Accounts payable	(7)		—		(7)
Accrued liabilities	(20)		—		(20)
Deferred income taxes	(167)		66		(101)
Total identifiable net assets	1,287		(154)		1,133
Total consideration	2,901		—		2,901
Goodwill	$	1,614	$	154	$	1,768