Press releaseMay 31, 1999
Austria Tabak to acquire Swedish Match's cigarette business
Swedish Match and Austria Tabak
have reached an Agreement to transfer the cigarette business of
Swedish Match to Austria Tabak for 4,800 MSEK in cash.
The Agreement is subject to the
satisfactory resolution of certain questions of practical and
legal nature and appropriate approvals from relevant authorities.
The cigarette business of Swedish
Match, with sales of 1.490 MSEK and EBIT of 473 MSEK (rolling 12
months), includes production facilities in Malmö, Sweden,
management and marketing functions in Stockholm and a sales-force
and in addition a local Estonian operation. In total appr. 500
employees will be subject to the transfer. The main products of
Swedish Match’s cigarette business are Blend, Right and John
Silver. Swedish Match had a 48 % market share in Sweden in 1998.
- "Through the
acquisition of Swedish Match’s cigarette business,
Austria Tabak will significantly expand its cigarette
operations and thus attain the scale to be increasingly
competitive in this business segment in the fast
consolidating European and global tobacco markets",
says Heinz Schiendl, President and Chief Executive
Officer of Austria Tabak. "In expanding into
cigarette markets which Swedish Match serves today,
Austria Tabak will look to use Swedish Match’s
cigarette business as a platform for the introduction of
selected brands of its own, whilst at the same time
developing and continuing to invest in the existing
established Swedish Match brands".
- "I envisage that key
management personnel and the majority of the employees of
Swedish Match’s cigarette operations will continue
to be employed subsequent to the transfer of ownership.
Further I envisage that the production facilities in
Malmö will continue in operation, he adds.
- "Today Swedish
Match’s business strategy focuses mainly on
smokeless tobacco, an area in which we foresee
considerable growth opportunities, particularly for moist
snuff, and on cigars", says Lennart Sundén,
President and Chief Executive Officer of Swedish Match.
"The strategic importance of cigarettes in our
product portfolio has diminished in recent years. Our
ambition is to arrive at a sound industrial solution for
the cigarette operations, with a new owner who can
provide better conditions for the long-term development
and management of these operations. Austria Tabak is an
ideal choice from that, as well as many other,
aspects", Lennart Sundén concludes. "In
addition we envisage further strategic co-operation in
markets outside of Sweden".
Swedish Match has been advised by
Merrill Lynch International and Austria Tabak has been advised by
CAIB Investment Bank AG.
Swedish Match is an international
group with headquarters in Stockholm, Sweden. The company
manufactures a broad range of tobacco products, matches and
disposable lighters that are sold in approximately 140 countries.
Annual sales in 1998 amounted to approximately MSEK 8,200.
Swedish Match is listed on the Stockholm Stock Exchange and on
NASDAQ
Austria Tabak is an international
manufacturing and trading group focusing on Austria and Germany.
The industrial activities comprise the production and marketing
of tobacco products. As a tobacco wholesaler, Austria Tabak has
operations in Austria, Germany and Hungary. The two divisions are
equally important for the earnings power of the Austria Tabak
Group. Annual sales in 1998 amounted to MATS 71.600 . Austria
Tabak is listed on the Vienna stock exchange.
For further information please
contact:
Swedish Match AB
- Lennart Sundén, President
& Chief Executive Officer Office +46 8 658 01 75
- Sven Hindrikes, Senior Vice
President &
- Chief Financial Officer
Office + 46 8 658 02 82
- Bo Aulin, Senior Vice
President, Corporate Affairs Office + 46 8 658 03 64
Austria Tabak AG
- Heinz Schiendl, Chief
Executive Officer Office +43 1 31342 1338
- Diethard Schwarzmair, General
Secretary Office +43 1 31342 1331
- Hubert Greier, Press Officer
Office +43 1 31342 1411
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