The European Commission confirmed yesterday it had given its regulatory blessing to plans by British American Tobacco to buy US rival Rothmans International.

The merger puts the new company, which will retain the British American Tobacco name, nearly neck and neck with world number one Philip Morris, with around 16 per cent of the global cigarette market and major international brands such as Lucky Strike, Kent and Rothmans.

The European Union executive said the new company would not hold a dominant position in Europe since it would face strong competition.