Re: Added Thoughts Here . . . .
The flaw referenced is not in the concept of a "merger of equals;" the flaw is in the seeming inclination of PM & MO to execute a merger in the first place (and when and if one finally occurs, I'll be surprised if it's accomplished without a premium included, one way or another; i.e., a merger of equals won't work). As to how 'tough it is out there,' if memory serves -- and each company has just raised its dividend, or is about to, -- MO's looking at long-term EPS growth at 4% - 7% annually (that seems to be the Wall Street view, and it's implied in the recent 5% dividend raise), while PM sees "8% or better, constant currency," as they've stated. In all . . . business has its challenges everywhere, but most companies would be pleased with those prospects.
The bottom line here: It'll be more than nice to be done with this merger speculation, one way or another, and hopefully sooner rather than later.