RJ Reynolds Announcement

British American Tobacco PLC
28 July 2004


                 RJR Shareholders Approve Proposed Combination

                  of Reynolds Tobacco and Brown & Williamson





The following statement has been released by R.J. Reynolds Tobacco Holdings,
Inc. relating to the result of the special meeting held to approve the proposed
combination of R.J. Reynolds Tobacco Company and the US business of Brown &
Williamson Tobacco Corporation.



As a result of the shareholder approval, the transaction is expected to close on
31 July and the shares of the new holding company, Reynolds American Inc., are
due to start trading on the New York Stock Exchange on 2 August 2004.  Through
Brown & Williamson, British American Tobacco p.l.c. will own 42 per cent of
Reynolds American Inc.





WINSTON-SALEM, N.C. -  July 28, 2004 - During a special meeting held today, the
shareholders of R.J. Reynolds Tobacco Holdings, Inc. (NYSE: RJR) voted to
approve the proposed combination of R.J. Reynolds Tobacco Company (RJRT) and the
U.S. business of Brown & Williamson Tobacco Corp. (B&W).



Of the 61,401,184 shares voted, 98.77 percent voted in favor of the combination.



"This vote demonstrates RJR shareholders' confidence in the value this business
combination brings to both the company's financial performance and competitive
position," said Andrew J. Schindler, chairman and CEO of RJR. "This transaction
will yield more than $500 million in annual operating efficiencies within the
next two years, and enable the new R.J. Reynolds Tobacco Co. to compete more
effectively in the U.S. cigarette market."



The agreement announced in October 2003 between RJR and B&W calls for the
creation of a new publicly traded holding company, Reynolds American Inc., with
approximately 150 million shares outstanding.  Reynolds American will trade on
the New York Stock Exchange under the trading symbol RAI once the transaction
has closed.



Also as part of the transaction, RJR will pay $400 million in cash to acquire
the stock of Lane Limited, a British American Tobacco p.l.c. (AMEX: BTI)
subsidiary that manufactures several roll-your-own, pipe tobacco and little
cigar brands, and distributes Dunhill tobacco products.



Once the transaction has closed, Reynolds American will have four operating
companies:   R.J. Reynolds Tobacco Company, Lane Limited, Santa Fe Natural
Tobacco Company, and R.J. Reynolds Global Products, Inc.  Existing RJR
shareholders will own approximately 58 percent of Reynolds American, through a
one-for-one exchange of their RJR stock for stock of the new company.  Through B
&W, BAT will own about 42 percent of Reynolds American Inc. stock. The U.S.
Internal Revenue Service has confirmed that the transaction will be tax-free to
RJR shareholders and BAT under existing Federal tax law and regulations.



Schindler will serve as executive chairman of Reynolds American Inc. for a
six-month period after closing, and then become non-executive chairman. Susan
Ivey, currently president and CEO of B&W, will serve as president and CEO of
Reynolds American Inc. The company's headquarters and operations will be
consolidated in Winston-Salem, N.C.



On August 2, 2004, a conference call regarding R.J. Reynolds Tobacco Holdings,
Inc.'s second-quarter financial results and the creation of Reynolds American
Inc. will be webcast at 9:30 a.m. Eastern Daylight Time.  The call will be
available online on a listen-only basis at www.RJRHoldings.com.  Registration
for the call is available on the Investors section of the site.





                                   ENQUIRIES



British American Tobacco Press Office            Investor Relations

David Betteridge/Ann Tradigo/Teresa La Thangue   Ralph Edmondson/Rachael Cummins
[phone] (24 hours)                  [phone] or 1519




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