Philip Morris International has reason to dig deeper to snag a Swedish nicotine pouch maker. Chief Executive Jacek Olczak needs to get 90% of shareholders to approve the $16 billion acquisition of Swedish Match , but recent developments have not been working in his favour. U.S. activist Elliott Investment Management upped its stake to 5% and is now the largest shareholder. Meanwhile, Olczak has extended the deadline for his 106 Swedish crown per share offer to Oct. 21 after fewer than 1% of investors accepted it.
, but recent developments have not been working in his favour. U.S. activist Elliott Investment Management upped its stake to 5% and is now the largest shareholder. Meanwhile, Olczak has extended the deadline for his 106 Swedish crown per share offer to Oct. 21 after fewer than 1% of investors accepted it.
Olczak could always lower the acceptance threshold to, say, 50%. Yet that risks a lengthy battle with activists, and may limit his ability to benefit from using Swedish Match’s distribution network. Besides, his quarry’s fortunes have improved since the deal was announced. Rising inflation may encourage smokers to buy cheaper chewing tobacco products: the average cost of a packet of cigarettes is $8, whereas a can of Swedish Match’s Zyn pouches fetches just $4. U.S.
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