Swedish Match completes transaction with Scandinavia Tobacco Group
Today, Swedish Match (SM) and Scandinavian Tobacco Group (STG) announce the
creation of a global company with leading market positions in cigars, pipe
tobacco and fine cut tobacco.
Following previous announcements in January and April 2010, all necessary
approvals have been obtained and the transaction was finalized on October 1st.
The new company will operate under the name Scandinavian Tobacco Group, and will
be headquartered in Copenhagen, Denmark.
SM has contributed its cigar businesses (with the exception of US mass market
cigars and its minority interest in Arnold André) as well as its pipe tobacco
and accessories businesses. STG has contributed all of its tobacco businesses
(cigars, pipe tobacco and fine cut tobacco).
Skandinavisk Holding A/S holds 51 percent of the new STG, and SM the remaining
49 percent.
"Swedish Match and STG have today created a focused tobacco company with an
outstanding brand portfolio and increased scale, providing a strong platform for
profitability and growth. The new STG is an important milestone in realizing our
strategy to develop the cigar business to best in class." said Lars Dahlgren,
CEO of Swedish Match.
Swedish Match will receive a cash consideration of 30 MEUR, subject to purchase
price adjustments, as compensation for the relative differences in enterprise
values of the contributed businesses. The new STG has a financial policy which
stipulates that the company shall have a Net Debt of two to three times EBITA.
After the new STG has assumed external debt, it will distribute excess cash to
its shareholders.
The main advisors to Swedish Match in this transaction have been Sundling Wärn
Partners and KPMG Transaction Services.
The new STG
The new STG is the second largest cigar company in the world with sales to more
than 100 countries. The company has leading positions for US premium cigars, for
European cigars, and strong positions in a number of other markets. Leading
cigar brands include Macanudo (US), CAO (US), Cohiba (US), Partagas (US), Punch
(US) for US premium cigars, and Café Crème, La Paz, Henri Wintermans, Colts,
Mercator for European cigars.
The company holds the global number one position in pipe tobacco with sales to
more than 60 countries. Leading pipe tobacco brands include Erinmore, Borkum
Riff, Clan, Half and Half, and W.Ø. Larsen. In addition the company is the
market leader in fine cut tobacco in selected markets, primarily in Scandinavia.
The company will distribute the lights products of Swedish Match in a number of
markets, mainly in Europe.
The new STG employs 9,700 people in 20 countries with production at 17 different
sites, sales companies in 15 countries and four distribution centers. Based on
the Swedish Match and STG 2009 results, the combined businesses had an annual
turnover of approximately 690 MEUR, EBITDA of approximately 140 MEUR and annual
volumes of about 2.5 billion machine made cigars, 115 million handmade cigars,
1,800 tons of pipe tobacco and 2,100 tons of fine cut tobacco.
The Board of the new STG consists of eight Directors, with four representing
each owner. Jørgen Tandrup, former Chairman of STG, is the Chairman of the
Board, and Conny Karlsson, Chairman of Swedish Match, is deputy Chairman. Anders
Colding-Friis, former CEO of STG, continues as the CEO of the new STG.
The New Swedish Match
The new Swedish Match will continue its focus on Smokefree tobacco with a vision
to become the global Smokefree leader. We will build on our leading position in
Scandinavia, our solid number three position in the US, and will continue our
efforts to commercialize snus in new markets. Swedish Match will continue
developing our successful US mass market cigar business, and further capitalize
on our strong brand equity in Chewing Tobacco. In the lights business, Swedish
Match operates on a global basis with strong brands for both matches and
lighters, with continued focus on operational excellence and selected growth
opportunities. The company also owns a distribution company focused on tobacco
products in Sweden. Furthermore, Swedish Match will, through its 49 percent
ownership, take an active role in realizing the full potential of the new STG.
The new Swedish Match has 3,900 employees in 10 countries.
___________________
For further information, please contact:
Lars Dahlgren, President and Chief Executive Officer
Office 46 8 658 0441, Mobile 46 70 958 0441
Joakim Tilly, Chief Financial Officer
Office 46 8 658 0213, Mobile 46 76Â 860 9597
Henrik Brehmer, Senior Vice President Corporate Communications
Office 46 8 658 0452, Mobile 46 76Â 111 3414
Emmett Harrison, Senior Vice President Investor Relations and Corporate
Sustainability
Office 46 8Â 658 0173, Mobile 46 70 938 0173
____________
Swedish Match develops, manufactures, and sells market-leading brands in Snus
and snuff products, Other tobacco products (US mass market cigars, chewing
tobacco) and Lights products. The Group sells products across the globe, with
production units in seven countries. The Group's global operations generated
sales of 14,134 MSEK for the twelve month period ending June 30, 2010. The
Swedish Match share is listed on the NASDAQ OMX Stockholm (SWMA).
____________
Swedish Match AB (publ), Box 7179, SE-103 88 Stockholm
Visiting adress: Västra Trädgårdsgatan 15, Telephone: +46 8 658 02 00
Corporate Identity Number: 556015-0756
www.swedishmatch.com
____________
The character of this information is such that it shall be disclosed by Swedish
Match AB (publ) in accordance with the Swedish Securities Markets Act. The
information was disclosed to the media on 4 October, 2010 at 8.30 a.m. (CET).
[HUG#1448689]
Press release (PDF):
http://hugin.info/1228/R/1448689/390888.pdf
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Swedish Match AB via Thomson Reuters ONE
