Since 1990s, the fall of the Iron Curtain in the East and the fast decline of cigarette market volumes in the West have triggered a series of acquisitions in the Tobacco Industry as the leading companies try to maintain the economies of scale and boost the top-/bottom-line growth. As a result, Tobacco is one of the most consolidated industries in the world – controlled by 5 major international tobacco companies and CNTC (China National Tobacco Corporation: China’s state tobacco monopoly).
The consolidation is still ongoing today as the major tobacco companies continue to compete with each other to acquire the few independent tobacco players left across the globe.
September 2026: Huabao International to Acquire Indonesian HNB Manufacturer for RMB 90 Million
Hong Kong-listed Huabao International Holdings Limited has agreed to acquire 100% of Indonesian manufacturer PT Broad Far Indonesia for RMB 90 million (US$13.35 million) in cash. Huabao is a major Hong Kong-listed investment holding company and one of China’s largest producers of flavors, fragrances, and tobacco raw materials. The acquisition expands Huabao beyond its traditional core of tobacco flavors and reconstituted tobacco leaves, giving the company direct heat-not-burn (HNB) stick manufacturing and international OEM/ODM capacity.
Based in Batam, Indonesia, PT Broad Far Indonesia specializes in producing HNB tobacco cartridges and herbal sticks, reporting US$4.37 million in revenue for the first half of 2026 and US$6.49 million for full-year 2025. The transaction will be executed via Huabao subsidiaries Nocton International and World Concept Global, making PT Broad Far an indirect, wholly owned subsidiary upon closing.
The deal establishes Huabao’s first overseas HNB manufacturing hub outside mainland China. By acquiring localized production in Southeast Asia, Huabao aims to service international brand owners seeking turn-key HNB OEM/ODM partners and accelerate its global market expansion.
September 2026: Imperial Brands Acquires Owner of Modern Oral Brand Helwit
Imperial Brands has acquired 100% of the shares of Swedish business Yoik Group AB, owner of modern oral nicotine pouch brand Helwit. The transaction involves an initial consideration of SEK 515 million (£39.8 million), with an additional performance-based deferred payment payable over two years. Following the acquisition, the entire Yoik team will join Imperial Brands.
Founded in 2019 near Växjö, Sweden, Yoik launched the Helwit brand in 2021. Helwit holds a 3.4% market share in Sweden, which is the largest modern oral nicotine market in Europe and accounts for more than 40% of total European market volume. The brand also maintains an online retail presence across Europe and physical availability in select UK retail stores. The deal more than doubles Imperial Brands’ modern oral market share in Sweden, where the company already operates through its subsidiary, Skruf AB. Imperial confirmed that the transaction aligns with its strategy for bolt-on acquisitions and that its multi-year share buyback program remains ongoing.
July 2026: Scandinavian Tobacco Group to Sell Fine-Cut Brands BREAK and Moro to Japan Tobacco
Scandinavian Tobacco Group (STG) has signed an asset purchase agreement to divest its fine-cut tobacco brands, BREAK and Moro, to Japan Tobacco (JT) for €176 million, corresponding to a pretax enterprise value of approximately DKK 1.3 billion. The post-tax transaction value is estimated at DKK 1.0 billion. The deal remains subject to customary closing conditions, including antitrust approvals, and is expected to complete before the end of the year.
The BREAK and Moro brands are primarily marketed in Germany. Based on STG’s 2025 full-year results, the two brands represented approximately 4% of reported net sales and gross profit before special items. Due to allocated operating expenses that will not transfer to JT, the brands accounted for around 6% of EBITDA before special items. Overall, fine-cut tobacco generated roughly 12% of STG’s reported net sales in 2025.
The divestment aligns with STG’s Focus2030 strategy, allowing the company to sharpen its strategic focus on categories with stronger long-term value creation opportunities. Net proceeds will be used to reduce debt, lowering STG’s leverage ratio below its target level of 2.5 times and increasing strategic and financial flexibility.
The agreement includes a contract manufacturing arrangement with JT for up to three years, during which STG will evaluate its manufacturing network to optimize mid-term efficiency. While the transaction is dilutive to earnings, it is not expected to impact STG’s 2026 guidance ranges for reported net sales growth or EBIT margin before special items. Free cash flow before acquisitions and divestments will be positively impacted at closing by an inventory transfer to JT. Further financial details will be provided upon completion.
March 2026: Philip Morris Divests Brazilian Match Business, Including Fiat Lux Brand
Philip Morris International (PMI) has agreed to sell its stake in Swedish Match do Brasil to Ignis FIP, in a transaction that also includes Swedish Match da Amazonia. Financial terms of the deal were not disclosed. The central asset in the transaction is the Brazilian Fiat Lux brand, one of the country’s most established household names in matches and lighters. Originally founded in the early 20th century, Fiat Lux has become synonymous in Brazil with safety matches, benefiting from decades of brand recognition and widespread distribution across both urban and rural markets. The brand has historically held a leading position in a category that, while mature, remains relevant in Brazil due to continued demand from households, small retailers, and certain industrial uses.
The buyer, Ignis FIP, is a Brazilian private investment fund backed by businessman Marcos Fernando Garms. Garms leads a diversified group with activities spanning sugar and ethanol production, agribusiness, and automotive distribution, suggesting potential synergies in logistics, distribution networks, and domestic market expertise. Until the transaction is finalized, Swedish Match do Brasil and Swedish Match da Amazonia will continue to operate as part of PMI, ensuring business continuity during the transition period.
The divestment reflects PMI’s ongoing portfolio optimization following its acquisition of Swedish Match, as the group sharpens its strategic focus on smoke-free products. While the Brazilian match business is not core to this direction, it remains a stable, cash-generative segment with strong local brand equity.
October 2025: British American Tobacco acquired stated-owned shares in UZBAT
British American Tobacco (BAT) Uzbekistan Investment Limited exercised its pre-emptive right to acquire a 2.6% share in UZBAT, the leading tobacco products manufacturer in Uzbekistan. The transaction, concluded with the State Assets Management Agency (UzSAMA), was valued at about лв269.7 billion (US$22.2 million) following an independent appraisal. With this purchase, BAT now holds 97.3% of UZBAT’s shares, while the employees etain about 2.7%.
UZBAT is both a major player in Uzbekistan domestic market and an exporter of finished products and input materials to several countries including Kazakhstan, Georgia, Azerbaijan, Iraq and South Korea. Since 2023, UZBAT has expanded its product range with heated tobacco sticks and other next-generation nicotine products. In the first nine months of 2024, UZBAT generated revenues of лв2.6 trillion (US$214 million) and net profit exceeding лв1 trillion (US$82.3 million). UZBAT ranks among the top private taxpayers in Uzbekistan.
With full control over the formerly state-owned stake, BAT gains stronger governance levers to further modernize operations, invest in new product lines, and scale its export capacity.
March 2025: Philip Morris International weighs selling its US cigar business
Philip Morris International (PMI) is exploring a potential sale of its cigar business in the US. The company is working with advisers to assess buyer interest and is seeking over $1 billion for the US cigar business. The cigar business was part of Swedish Match which was acquired by PMI in 2023 for $16 billion. Swedish Match is the second largest player in the US market for mass market cigars (excluding little cigars) with a strong position within both the natural leaf and homogenized tobacco leaf (HTL) segments. In 2024, PMI announced that a strategic review of the US cigar business was ongoing as the decline in the US cigar market continues. Read more: Cigar Market.
Divestment of the US cigar business will contribute to PMI’s ambition of becoming a two thirds smoke-free business by 2030.
October 2024: Japan Tobacco completes acquisition of Vector Group
Japan Tobacco (JT) completed the acquisition of Vector Group (VGR) on October 7, 2024, following a tender offer, initially announced on August 21, 2024 (- see below for further details). The tender offer was subject to approval under U.S. and Serbian antitrust laws, the tender of more than 50% of VGR’s outstanding common stock, and satisfaction of other customary closing conditions. The conditions of the offer is satisfied with ~68.7% of the common stock tendered (108.1 million shares). Untendered shares are cancelled and converted into the right to receive the same consideration payable in the tender offer (i.e. US$ 15.00 per share).
With the VGR acquisition, JT expects to improve its return-on-investment in combustibles by significantly expanding its presence and distribution network in the US market. VGR becomes a wholly owned subsidiary of JT and is delisted from the New York Stock Exchange on October 7, 2024. The overview of subsidiary to be transferred to the JT is as follows:
August 2024: Japan Tobacco acquires Vector Group
Japan Tobacco (JT) acquires Vector Group (VGR). Under the terms of the definitive agreement, JT will offer $15 per share in cash to acquire all outstanding shares of Vector through a tender offer and second-step merger1. The offer represents a premium of 30% over the 60-day volume-weighted average share price and corresponds to ~$2.4 billion of total equity value (in addition to redemption or repayment of debt). JT will conduct the tender offer through Vapor Merger Sub Inc., an entity established for the purpose of this acquisition. The Boards of Directors of both companies have unanimously approved the merger agreement.
The transaction is subject to customary closing conditions, including the tender of a majority of the outstanding shares of Vector and the receipt of applicable regulatory approvals. The transaction is expected to close in Q4 2024. Following closing, VGR will be a wholly owned consolidated subsidiary of JT and be de-listed from the New York Stock Exchange.
Vector Group is headquartered in Miami, Florida, with an executive office in Manhattan and tobacco operations in North Carolina. Founded in 1873 (as Liggett & Myers), Vector is the 4th largest cigarette manufacturer in the US with 5.6% national market share. Vector focuses on the discount segment and its core brands include Montego, Eagle 20’s, Pyramid, Grand Prix, Liggett Select and Eve. Montego, sold at 50% discount to Marlboro, is the largest US (deep) discount brand. Vector reported $385 million adjusted EBITDA in the 12-month period ended June 30, 2024 for its tobacco operations. Vector also owns New Valley, which holds minority investments in various real estate projects throughout the US.
JT states that this acquisition will
– improve the its return-on-investment (ROI) in combustibles with the addition of a growing and historically profitable business
– significantly expand its presence in the key US market, boosting its market share from 2.3% to ~8.0% with the full ownership of two of the top-10 US cigarette brands
– strengthen its distribution network and improve its competitiveness in the US, creating mid-/long-term strategic opportunities
– strengthen its financial position through mid-/long-term hard currency profits and cash flows.
May 2024: Philip Morris International acquires a minority indirect stake in Eastern Company
Philip Morris International (PMI) acquires a minority indirect stake (14.7%) in Eastern Company, Egypt’s largest cigarette manufacturer. As part of this acquisition, PMI and Eastern seek to explore, on a non-exclusive basis, potential strategic areas for mutual long-term collaboration, in the fields of technology, manufacturing, and innovation, including heated tobacco products. Recall that, in August 2023, UAE’s Global Investment Holding acquired a 30% stake in Eastern Company. For further details: See below.
Egypt is home to 18Mn smokers and is the world’s 7th largest cigarette market by volume (~94Bn sticks a year). Only Philip Morris International (PMI) and the former monopoly, Eastern Company, own a licence to manufacture cigarettes in Egypt. Eastern Company controls more than 70% of the market and also has a ~24% stake in United Tobacco Company (UTC; majority-owned by PMI). Production & distribution of foreign brands (including those of Japan Tobacco International) are handled by Eastern Company. For further details: Egypt: Tobacco Market
August 2023: UAE’s Global Investment Holding buys a 30% stake in Eastern Company
UAE’s Global Investment Holding buys a 30% stake in Eastern Company, the largest cigarette manufacturer in Egypt, for $625Mn2,3. The UAE firm will also provide $150Mn for tobacco procurement. PMI and JTI were among the bidders although their offers presented a conflict of interest (see below for further information).
Background information4,5: The Holding Company for Chemical Industries, which owns 50.95% of Eastern Company, received offers from foreign investors for a 30% stake in Eastern. The bidders included JTI, United Tobacco Company (UTC; majority-owned by PMI) and a GCC investor group. The bids of JTI and UTC were around $700Mn (i.e. valuing the total entity at $2.33Bn – or, 60% above the current market capitalization).
The PMI & JTI offers presented a conflict of interest. If PMI won the deal, its market share and influence in the Egyptian tobacco market would increase substantially – especially, considering that PMI already won, at the expense of JTI, the only licence offered by the government to manufacture cigarettes in Egypt (outside the former monopoly, Eastern Company). Moreover, PMI would also have a voice in the production & distribution of JTI’s (and other foreign companies’) brands that are monopolized by Eastern Company. If JTI won, it would become an indirect shareholder in PMI’s Egyptian business as Eastern Company owns ~24% of UTC.
Egypt is home to 18Mn smokers and is the world’s 7th largest cigarette market by volume6 (~100Bn sticks a year). Eastern Company controls more than 70% of the market.
November 2022: PMI requested the de-listing of Swedish Match shares from the stock market
PMI announced that 93.1% of Swedish Match shares are now tendered7. Subsequently, PMI initiated a compulsory redemption of the remaining shares (“squeeze-out”) and requested the de-listing of Swedish Match from the stock market (December 2022).
Background information8,9: In May 2022, PMI announced a public offer to Swedish Match shareholders to tender their shares. The original offer: SEK106/share (~$16Bn equity value; ~$17.5Bn enterprise value, 17x consensus 2023 EBITDA). In October 2022, PMI increased its offer to SEK116/share and announced that it will not further increase the price. The offer acceptance period ended on November 4, 2022 and 82.6% of the Swedish Match shares were tendered. PMI further extended the acceptance period to November 25, 2022.
2017-18: Japan Tobacco’s Buying Spree
In August 2017, Japan Tobacco International (JTI) acquired the assets of Mighty Corp for $936Mn (P46.8Bn)10. Established in 1945, Mighty Corp is the oldest Filipino tobacco company, manufacturing brands like Mighty, King, and Chelsea. Also in 2017, JTI purchased the Indonesian Kretek producers Karyadibya Mahardhika and Surya Mustika Nusantara from Gudang Garam for $677Mn. A year later, in 2018, JTI acquired Donskoy Tabak, Russia’s fourth largest cigarette manufacturer for $1.6Bn.
References:
- https://www.jt.com/media/news/2024/pdf/20240821_E1.pdf ↩︎
- UAE company purchases 30% stake in Eastern Company, Cabinet – EgyptToday ↩︎
- Emirati company buys 30% stake in Egypt tobacco firm Eastern Co. | Reuters ↩︎
- https://www.dailynewsegypt.com/2023/08/23/philip-morris-jti-compete-to-buy-stake-in-eastern-company ↩︎
- https://www.zawya.com/en/markets/equities/egypt-eastern-company-stake-sale-to-be-completed-by-mid-2024-s9becb24 ↩︎
- https://www.newarab.com/news/egyptians-smoke-100-billion-cigarettes-year-tobacco-chief ↩︎
- https://www.pmi.com/media-center/news/PMI-progresses-toward-sole-ownership-of-swedish-match ↩︎
- https://www.pmi.com/investor-relations/press-releases-and-events/pmi-offer-swedish-match-ab ↩︎
- https://www.swedishmatch.com/Investors/information-on-cash-offer-announcement-by-pmi ↩︎
- 6 Japanese Companies That Have Acquired Sizable Stakes in Filipino Corporations (esquiremag.ph) ↩︎
