Swedish Match investors oppose takeover by Philip Morris
A Swedish Match concept store for the tobacco group's moist powder tobacco "snus" in Stockholm, Sweden October 24, 2018. REUTERS/Anna Ringstrom/File Photo
The clock is ticking for tobacco giant Philip Morris International (PMI) to rally support from Swedish Match shareholders for its offer to buy the snus maker - and not everyone is on board.
Chicago-based Framtiden Partnerships, a Swedish Match shareholder for nearly two decades, on Wednesday said it opposes the proposed takeover of the Stockholm-based company.
The investor - incorporating Framtiden Management Company LLC and affiliates - which owns 1 per cent of Swedish Match, has written a white paper urging others to reject the deal that 90 per cent of shareholders need to approve before October 21, by Swedish law.
Framtiden believes PMI's SEK 106 (£8.5) per share offer "does not adequately value Swedish Match's leading position in the rapidly growing non-tobacco nicotine pouch segment in the United States". Managing Member Dan Juran estimates the business to be worth close to SEK 200 per share.
According to Euromonitor International, Swedish Match controls about half the world's market for snus - a Swedish-style snuff that is moist and smoke-free. The company is also the global industry leader for nicotine pouches.
Juran, who is also chairman of Swedish Match's nominating committee, warned other investors not to be "tempted by the short-term premium" Philip Morris had offered. His Swedish Match position accounts for over a quarter of his total capital.
"I was dismayed to see the board recommend the sale of this Swedish jewel at a bargain price in the early stage of probably the greatest chapter in its long history," Juran said.
Swedish Match has been trading above the SEK 106 offer price since late July, suggesting investors anticipate PMI will need to make a higher offer.
DNB Markets analyst Jesper Ingildsen said it is currently highly uncertain whether PMI will be able to cross the required 90 per cent threshold to acquire the whole company. Swedish Match has a fragmented ownership base, he said, making it difficult to get a clear overview of how many will accept the deal.
Swedish Match declined to comment. Philip Morris did not immediately respond to a request for comment.
John Hempton, co-founder of Sydney-based Bronte Capital, is another Swedish Match shareholder who hopes the deal will fall through.
Hempton, who holds a 1 per cent stake in Swedish Match, told Reuters that he and other undisclosed shareholders believe that the company has the potential to end up as a $100 billion company that could find itself with 10-20 per cent of the US nicotine market.
"There are basically three camps; those who plan on accepting the deal, those who will try to get the offer price increased, and those who want Swedish Match to stay as Swedish Match, and I am firmly in the last camp," Hempton says.
Swedish real estate entrepreneur Erik Selin, who according to Swedish Match's website on Aug. 20 owned around 0.4 per cent, told Reuters previously he planned on accepting the offer. Selin, a shareholder in Swedish Match since 2005, said he thought the offer price was fair and considered PMI a good buyer for the Swedish company.
The largest shareholders of Swedish Match, which include Wellington Management, Capital Group, BlackRock and Vanguard, all declined to comment on the deal.
On Sept. 2, Elliott Investment Management said that the stake it had been building in Swedish Match since PMI's offer had reached 5.25 per cent, making it one of the largest shareholders in the company.
The activist investor was planning on opposing the Marlboro maker's bid under its current terms, Bloomberg reported in July.
It was shortly after Elliott's rumoured involvement that Swedish Match's shares started to rise above the offer price, having shot up to that level from SEK 76 shortly after the offer was made in May.
Handelsbanken analyst Karri Rinta said he thought it unlikely that PMI would up its bid, viewing the likelihood of an activist investor succeeding as low.
"PMI is the bidder that can afford to pay the most, since they have very little overlap with Swedish Match today," he said. "All other industrial buyers would run into all kinds of divestment troubles."
Some Brits believe that shoplifting can be acceptable, states a recent report, despite the country experiencing an epidemic of store thefts.
According to a recent YouGov poll of 2,150 adults, 40 per cent of the public agreed that shoplifting food was sometimes acceptable if a person could not afford the goods. More than half of those asked (51 per cent) said it was never acceptable.
About 20 per cent believed it was sometimes acceptable to steal clothes from a store if they could not afford them, with 72 per cent saying it should never be accepted.
This was despite the fact that nearly three-quarters of the public (73 per cent) believed shoplifting was a serious or fairly serious crime, while only a quarter (25 per cent) felt it was not very serious or not serious at all.
There was a distinct divide politically between acceptance of the crime. Only 20 per cent of Tory voters believed that food theft was acceptable if a person could not afford it, compared with 50 per cent of Labour voters and 44 per cent of Liberal Democrat supporters.
The staggering figures come as stores across the country are reporting two thefts a minute amid a growing shoplifting epidemic.
Industry body the British Retail Consortium's (BRC) annual crime survey found more than 20 million incidents of theft were committed in the year to 31 August 2024, which equates to 55,000 a day, costing retailers a total £2.2 billion.
There were 16 million incidents in the previous year.
The BRC said many more incidents in the latest period were linked to organised crime, with gangs systematically targeting stores across the country.
Commenting on the BRC's findings, Helen Dickinson said, "Retail crime is spiralling out of control. People in retail have been spat on, racially abused, and threatened with machetes.
"Every day this continues, criminals are getting bolder and more aggressive."
The BRC said the amount spent on crime prevention also hit a record high, with retailers investing £1.8 billion on measures such as CCTV, security personnel, anti-theft devices and body-worn cameras, up from £1.2 billion in 2022-23.
Shopper footfall received a welcome boost as many consumers hit the January sales in their local community, shows recent data, bringing a welcome news for high streets following a particularly difficult Golden Quarter to end 2024.
According to BRC-Sensormatic data released today (7), total UK footfall increased by 6.6 per cent in January (YoY), up from -2.2 per cent in December.
High Street footfall increased by 4.5 per cent in January (YoY), up from -2.7 per cent in December while retail park footfall increased by 7.9 per cent in January (YoY).
Shopping Centre footfall increased by 7.4 per cent in January (YoY), up from -3.3 per cent in December.
Footfall increased year-on-year in all four UK nations, with Wales improving by 8.5 per cent, England by 7.4 per cent, Northern Ireland by 3.5 per cent, while Scotland improved by 1.0 per cent.
Helen Dickinson, Chief Executive of the British Retail Consortium, said, "Shopper footfall received a welcome boost in January following a disappointing festive period.
"Store visits increased substantially in the first week of the month as many consumers hit the January sales in their local community, with shopping centres faring particularly well.
"Despite snowy weather and Storm Eowyn causing disruption in some areas, footfall was still positive across major UK cities over the whole month.
"Improved shopper traffic is welcome news for high streets following a particularly difficult ‘Golden Quarter’ to end 2024, and low consumer sentiment to start the year.
"Retailers want to invest more in stores and staff to enhance the shopping experience for customers and help to grow the economy, but the swathe of additional costs from April will limit investment and lead to job losses and higher prices at the tills. To drive growth in communities across the country, the government must ensure costs are limited in other areas.
"This can be done by delaying packaging taxes and ensuring that business rates reform leaves no shop paying more than they currently do."
Andy Sumpter, Retail Consultant EMEA for Sensormatic, commented, "After a dreary December, retailers will welcome January’s footfall jump.
"The uptick was boosted by a very strong Week 1, helped in part by New Year’s Day falling on a Wednesday, which may have prompted ambient store traffic as consumers bolted on additional days of leave, as well as retailers extending post-Christmas discounting well into January.
"Not even the significant disruption from Storm Eowyn was enough to dampen overall footfall performance. While welcome, after months of erratic and constrained footfall, the jury’s out as to whether January’s store performance signals the start of a sustained High Street revival or if it will be a flash in the pan come February.
"And, even if shopper traffic recovery has finally turned a corner, the challenge for retailers will be solving the next conundrum; how they balance enhanced footfall – which requires optimised store staffing to convert into sales – and the significant rises to labour costs borne out of the Budget on the one hand, with consumer appetite for discounts - a long-term margin-eroder - on the other, which will not be an easy circle to square."
Another report released on Thursday (6) stated that high streets need to optimise for midweek office workers as Brits return to office.
This marks the first annual increase in January footfall since 2016 (+1.2 per cent), outside of the pandemic period, suggesting that a stronger return to office work is driving retail visits as businesses push employees back to in-person work.
Keep ReadingShow less
New Ann Forshaw’s Milk Shed launches at SPAR Derwent in Keswick
SPAR Derwent in Keswick has become the latest store to introduce an Ann Forshaw’s Milk Shed, bringing fresh whole milk and delicious flavoured milkshakes to the local community.
The new Milk Shed follows successful launches at Ann Forshaw’s Alston Dairy and SPAR stores in Burnley and Milnthorpe.
The vending machine, open 24-hours-a-day, dispenses gently pasteurised, non-homogenised milk, available in 500ml (£1) and one-litre (£1.60) servings, with milk delivered daily from Alston Dairy at Longridge, near Preston, the home of the Ann Forshaw’s brand.
Milkshakes, priced at £1.80 for 500ml and £2.80 for one litre, come in Chocolate, Strawberry, Banana, Vanilla, and Salted Caramel flavours. A sixth Limited Edition flavour will always be on rotation to complement the core range – starting with Red Velvet for Valentine’s Day, and special edition glass bottles with love hearts on them will be available to purchase from the machine.
To celebrate February half-term, a retro throwback range featuring Cream Soda, Parma Violet, Cola, Lime, Candy Floss, and Mixed Berry will also be available.
Ann Forshaw’s Milk Shed at SPAR Derwent
All the milkshakes use natural flavourings and colourings where possible and do not contain the ‘Southampton Six’ food colours which have been found to have an adverse effect on activity and attention in children.
Eco-conscious customers can opt for Milk Shed branded reusable glass bottles for plastic-free refills. Plus, recyclable cups and paper straws are available for a greener experience.
“Wherever we launch an Ann Forshaw’s Milk Shed, our SPAR customers love the concept, and we have high hopes that our latest launch will be lapped up by the community in Keswick,” Fiona Drummond, Company Stores Director at James Hall & Co. Ltd, said.
“There is nothing not to like about the product. The milk is competitively priced, and the milkshakes are a delicious treat and suitable for all ages with the conscious decision to utilise natural flavourings.”
There is more to come for SPAR customers in Cumbria this Spring with rollouts of Milk Sheds taking place soon at SPAR Bowness, SPAR Maryport, and SPAR Whitehaven.
Ann Forshaw’s and its associated Alston Dairy was acquired by the James Hall Group of Companies in December 2022.
Keep ReadingShow less
SPAR Cavehill raised funds for Community Fire & Rescue Service as part of former owner’s 70th birthday celebrations
Belfast’s SPAR Cavehill closed out 2024 with a heartwarming community celebration, marking the 70th birthday of former store owner Norman Porter while raising £800 for two local charities.
The event, organised by the store’s current owners, Frank Quigley and Norman’s daughter, Jenny Reilly, brought together staff, customers, and local residents to celebrate the milestone birthday and support SPAR’s charity partner, Marie Curie, as well as the Community Fire & Rescue Service.
Norman, who owned and operated SPAR Cavehill for over 40 years, remains an integral part of the store’s daily operations even after passing ownership to Jenny and longtime store manager Frank in 2015. His longstanding presence in the community made the occasion particularly special.
“It was important to me and the whole team to celebrate dad’s 70th birthday,” Reilly said. “Having owned and run SPAR Cavehill for over 40 years, he is a well-known and respected figure in the local community, so our shoppers were delighted to join in the celebrations and show their appreciation.”
The in-store birthday party featured cake, coffee, and treats in exchange for donations, while customers also had the opportunity to win prizes with the SPAR Spinner. Special guest Sammy SPAR made an appearance, adding to the festive atmosphere. Volunteers from the Community Fire & Rescue Service attended to thank shoppers for their support and raise awareness of their vital services. Additionally, the Dale Farm van stopped by to distribute ice lollies in return for contributions to Marie Curie.
“Being a hub in the community, it’s always been important to us to show our support, so it was a no brainer to mark my dad’s birthday by fundraising for two local charities,” Reilly added.
“The celebrations were a great success, and we were thrilled to see so many of our community coming together to show their support, helping us raise a total of £800 for Marie Curie and Community Fire & Rescue Service. I want to extend a huge thank you to our shoppers and our team at SPAR Cavehill.”
Expressing his gratitude, Norman Porter said: “Thank you to the team at SPAR Cavehill, our shoppers and whole community for celebrating my 70th birthday with me. It has been a privilege to serve the community for so many years and we have appreciated their ongoing support for the store. A special thank you goes to my daughter Jenny for making it a birthday to remember.”
Keep ReadingShow less
IQOS heat-not-burn device and a Marlboro cigarette pack
Philip Morris International (PMI) has forecast an increase of up to 12.5 per cent in adjusted diluted EPS for 2025, following a strong financial performance in 2024, driven by the continued expansion of its smoke-free product portfolio.
The company delivered a reported diluted EPS of $4.52 (£3.63), or $6.01 before a Canada non-cash impairment of $1.49, compared to $5.02 in 2023. Adjusted diluted EPS reached $6.57, representing growth of 9.3 per cent, and 15.6 per cent on a currency-neutral basis.
“2024 was a remarkable year for PMI,” said Jacek Olczak, PMI chief executive. “We delivered very strong full-year results driven by the continued growth of IQOS and ZYN in addition to a robust combustibles performance.”
Olczak highlighted the recent US FDA authorisation of all currently marketed ZYN nicotine pouches, calling it “further evidence of the compelling science supporting smoke-free products.” He also urged other countries to follow the US lead and embrace effective tobacco harm reduction measures, particularly where smoke-free alternatives are banned.
Quarterly shipments of heat-not-burn (HTU) and oral smoke-free products exceeded 40 billion units for the first time. Full-year net revenues for the Smoke-Free Business increased by 14.2 per cent (16.7 per cent organically), with gross profit up 18.7 per cent (22.7 per cent organically). Smoke-free products now account for 40 per cent of PMI's total net revenues and approximately 42 per cent of gross profit. The company estimates 38.6 million adult users of its smoke-free products.
IQOS continues to be a strong performer, strengthening its position as the second-largest nicotine ‘brand’ in markets where it is present. HTU adjusted in-market sales (IMS) volume was up an estimated 12.6 per cent for the full year. In Japan, ILUMA i fuelled IQOS growth, with adjusted IMS up around 13 per cent for both the full year and the fourth quarter. In Europe, IQOS HTU adjusted market share increased to 10.6 per cent in the fourth quarter. VEEV is also gaining traction as a top 3 pod brand in 13 European markets.
In the oral smoke-free products business, full-year shipment volume increased by nearly 28 per cent in cans (nearly 25 per cent in pouches). Fourth-quarter shipment volume increased by 25 per cent in cans (22 per cent in pouches), driven by ZYN nicotine pouch growth in the US.
Full-year net revenues grew by 4.0 per cent (5.9 per cent organically) in the combustibles business, primarily due to strong pricing.
For 2025 fiscal, PMI forecasts reported diluted EPS to be in the range of $6.55 to $6.68. Excluding adjustments, this reflects a 7.2 per cent to 9.1 per cent increase compared to 2024’s adjusted EPS of $6.57, or 10.5 per cent to 12.5 per cent growth on a currency-neutral basis.
The company anticipates total cigarette and smoke-free product shipment volume growth of up to 2 per cent, driven by smoke-free products. Net revenue growth is projected at around 6 per cent to 8 per cent on an organic basis.
“With strong momentum across all categories, we are confident that our smoke-free transformation and unparalleled brand portfolio will continue to deliver excellent performance and create value for our shareholders in 2025 and for the long term,” Olczak said.
The forecast assumes an estimated 1 per cent decline in international industry volume for cigarettes and HTUs (excluding China and the US), and an acceleration in US nicotine pouch shipment volume. It also factors in capital expenditures of approximately $1.5 billion, including further ZYN capacity investments in the US.