May 20, 2022
Swedish Match snus

Philip Morris has announced it is in talks to buy rival Swedish Match, with the tobacco giant looking to expand its smoke-free options amid the waning popularity and increasing regulation of traditional cigarettes.

No decision has been made yet as to whether an offer will be made, Philip Morris said in a statement. It is believed the deal could be valued at $15 billion.

The proposed deal follows on from the purchase of asthma inhaler manufacturer Vectura last year, with Philip Morris acquiring the company to further their plans for smoke-free products. The firm is keen to expand its offerings with sales of traditional cigarettes flagging, the industry having taken another hit last month when the FDA issued a long-awaited ban on flavored cigars and menthol cigarettes.

Swedish Match makes snus, a wet snuff product that is banned across the European Union except in Sweden, as well as cigars, chewing tobacco and matches. Snus is legal for consumption in the US.

Talks between the two parties are ongoing and could produce a deal as early as this week, although the touted price tag has been called into question.

Bronte Capital, which owns over 15 million shares of Swedish Match, released a statement saying that the offer undervalues Swedish Match, arguing that the company has a bright future.

“We believe the future for Swedish Match is considerably better than the price reflected and we are not happy with this offer,” said the statement, adding that the company would consider its future actions.