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It stated the provide worth for the Stockholm-listed firm amounted to about 161.2 billion Swedish crowns ($16 billion).
Swedish Match shares hit a document excessive on Tuesday after PMI confirmed reviews it was in talks to purchase the Swedish agency, betting on the fast-growing marketplace for cigarette alternate options. Swedish Match shares rose an extra 9% on Wednesday at 103.50 crowns.
The Swedish firm makes most of its revenue from Swedish-style snuff referred to as “snus”, however gross sales of its Zyn tobacco-free nicotine pouches are rising quickly in Scandinavia and america as customers turn into extra health-conscious.
PMI was spun off from U.S. peer Altria in 2008.
Buying Swedish Match would give PMI, which is U.S.-based however doesn’t promote its merchandise in america, entry to a ready-made distribution community, taking up its former homeowners in its house market.
Swedish Match, which reported first-quarter earnings on Wednesday that have been barely beneath market expectations, stated gross sales and earnings from Zyn grew considerably in america, with deliveries up 35%.
The Swedish Match board stated in a press release it believed “the phrases of the provide recognise Swedish Match’s long-term development prospects, bearing in mind the dangers related to the realisation of these prospects”.
The decision was supported by all board members save one, a consultant of commerce union IF Metall, who stated Swedish Match had the competence and expertise to stay impartial and that the provide didn’t mirror its long-term basic worth.
Analysts at Credit score Suisse stated they’d a optimistic view on the bid degree, saying it represented a roughly 40% premium to its beforehand undisturbed worth.
PMI stated finishing the provide was conditional on regulatory approval and on no different firm making a proposal that was extra beneficial to Swedish Match’s shareholders.
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