Let’s look at some highlights for the Fund. In last year’s annual letter, we noted many virtues of Reynolds as a core portfolio investment for many years. A smart management team combined Reynolds with Lorillard, Inc. in an earnings-accretive deal, creating an even more powerful cash generating business. In the process, the company increased its appeal to British American Tobacco plc (“BAT”), its largest owner with 42% of outstanding shares, as a must-own asset to fully capture opportunities in the U.S. and benefit from Reynolds’s product innovations. Our belief that BAT (BAT) would eventually bid for the rest of the shares came to fruition last October, resulting in a surge in the value of Reynolds, the Fund’s largest holding. With an improved deal price and structure more favorable to shareholders, Reynolds agreed to the takeover in January of 2017 (closing is expected by the Adviser to occur in the third quarter of 2017). As shareholders of BAT, another top holding of the Fund, we hope to continue to collect the steady amounts of cash returned by this combined powerhouse.
From David Winters (Trades, Portfolio)' Wintergreen Fund (Trades, Portfolio) 2016 annual report letter to shareholders.
