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DUFF & PHELPS ADDS RJR NABISCO HOLDINGS CORP. & RJR NABISCO, INC. TO RATING WATCH -- UNFAVORABLE

 NEW YORK, April 2 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has placed the long-term securities of RJR Nabisco Holdings Corp. (NYSE: RN) and RJR Nabisco, Inc. on rating watch for a potential downgrade.
 The current ratings are as follows: RJR Nabisco, Inc.'s senior debt, `BBB' (Triple-B); subordinated debt, `BB+' (Double-B-Plus). Approximately $11 billion of debt is affected.
 This action primarily reflects the announcement earlier today by industry leader Philip Morris (PM) of a major shift in strategy for its domestic tobacco operations. PM plans to lower the average price of its market leading Marlboro brand, expand distribution of discount brands and forego further price increases on premium brands for the foreseeable future. According to PM, operating earnings of its U.S. tobacco business could be down as much as 40 percent in 1993.
 The impact of PM's action is likely to cause RJR to respond with price reductions to maintain market position and limit RJR's pricing flexibility on its premium brands. These actions could have an ongoing negative affect on profits and cash flow for RJR. Domestic tobacco accounts for about 58 percent of RJR's cash flow.
 -0- 4/2/93
 /CONTACT: Thomas P. Rajukis, CFA, or Phillip T. Maffei, CFA, both of Duff & Phelps Credit Rating Co., 212-908-0200/
 (RN)


CO: RJR Nabisco Holdings Corp. ST: Georgia IN: FOD TOB SU: RTG

TM -- NY074 -- 2683 04/02/93 17:13 EST
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Publication:PR Newswire
Date:Apr 2, 1993
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