Key Issue: Is $1 Billion Appropriate to Increase UST Company Value and Ultimately Shareholder Value? Higher leverage is very likely to create value for a company that considers changing capital structure by exercising financial discipline and more efficient companies strategy changes. Before evaluating whether $1 billion increases value in quantitative terms, one should consider the ability to meet prerequisite interest payments and potential dividend payments (possibly maintaining dividend growth). Required Debt Rate and Pro Forma Income Statement Risk Drivers Credit rating agencies take a wide range of factors: the purpose of raising the debt, the industry outlook, the company profile and the financial measures to take into consideration when provides corporate bond rating services. Debt is accumulated to buy back shares rather than to seize expansion opportunities to strengthen cash flow. This will not be seen as favorable to debt holders as the debt coverage capacity in terms of cash or collateral is not strengthened. UST is positively characterized by its leadership position in the smokeless moist tobacco market, strong brand recognition, premium product offerings and pricing flexibility; negatively due to the lack of geographic and product diversification, eroding market share, poor performance of non-core investments and the recent reshuffle of key executives and the antitrust dispute with Conwood Co.. In addition to its cash-generating nature , the smokeless tobacco market still faces legal challenges (legislation, litigation, marketing ban), slowing growth, and the possibility of future health research negatively influencing customer behavior. Financial measures will be conducted in the form of a pro forma income statement, key figures and… half of the document… the profit is shared by a larger group of equity investors. The company is still subject to a similar level of risk compared to immediate repurchase based on credit rating drivers. More importantly, abundant initial liquidity with promising investment projects will lead to even poorer performance of non-core investments. Third, serial loans and repurchases over several years are considered. This is essentially the financial policy adopted by the company in recent years. This policy is less risky as measured by coverage ratios and is more acceptable to shareholders. However, UST has imminent challenges and value improvement goals to achieve. If the company has untapped debt capacity, large sum buybacks avoid excessive consultancy fees, negotiation time and effort, potential credit rating charges, while an immediate and significant tax shield benefit is made possible.