Get 40% Off
🚀 Our AI Picked 6 Stocks that Jumped +25% in Q1. Which Picks Will Soar in Q2?Unlock full list

Elliott could seek seat on Swedish Match board -source

Published 09/30/2022, 05:35 AM
Updated 09/30/2022, 02:26 PM
© Reuters. FILE PHOTO: A woman poses with a cigarette in front of Philip Morris International logo in this illustration taken July 26, 2022. REUTERS/Dado Ruvic/Illustration

By Marie Mannes and Richa Naidu

GDANSK/LONDON (Reuters) -Elliott Management Corp, which has raised its stake in Swedish Match, would consider taking a seat on the board of the Stockholm-based maker of Zyn nicotine pouches, according to a source familiar with the matter.

Along with three other investors and a chair, Elliott is on a nominating committee that under Swedish law can evaluate who should be on Swedish Match's board, according to the Swedish Match website.

Philip Morris International (NYSE:PM)'s $16 billion offer for Swedish Match is hanging in the balance after Elliott disclosed on Friday that it had increased its stake to 7.25% from 5.5%.

By Swedish law, 90% of Swedish Match shareholders need to approve the offer before Oct. 21, but some oppose the 106 Swedish crown per share bid for one of the world's biggest makers of oral nicotine products.

Elliott, an activist hedge fund manager, declined to comment.

Bloomberg reported in July that the activist investor was believed to be planning to oppose the deal under its current terms. Elliott's increased stake means the offer will fail if another 2.75% of shareholders take a similar view.

Philip Morris and Swedish Match did not immediately respond to requests for comment.

Philip Morris in May offered to buy the company in a bet on the fast-growing market for cigarette alternatives.

According to Euromonitor International, Swedish Match controls about half the world market for snus - a Swedish-style snuff that is moist and smoke-free. The company is also the global industry leader for nicotine pouches.

Swedish Match shares traded at 110 crowns on Friday and have been trading above the offer price since late July, suggesting investors anticipate PMI will need to make a higher bid.

Philip Morris' CEO told Reuters this week the company is not considering withdrawing its offer despite deteriorating global economic conditions and has "options on the table" including holding a majority stake.

© Reuters. FILE PHOTO: A Swedish Match concept store for the tobacco group's moist powder tobacco

Shareholder Framtiden Partnerships, which has held Swedish Match shares for nearly two decades and owns 1%, told Reuters last week that it opposes the takeover.

($1 = 11.1382 Swedish crowns)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.