Lorillard Inc., the third-largest seller of cigarettes in the U.S., jumped the most in two years in New York trading on speculation that Reynolds American Inc. will make a bid for the company.

Reynolds has hired the investment bank Lazard to explore a deal, the Financial Times reported today. The purchase price could be more than $20 billion, the FT said, citing unidentified people familiar with the situation. It’s unclear, though, if Reynolds plans to bid for the whole company, the paper reported.

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