Philip Morris to buy Swedish Match

Cigarette manufacturer Phillip Morris buys snus manufacturer Swedish Match. A major step towards global harm minimisation, according to many international commentators.
"Hopefully, this will lead to easier access to harm reduction products for consumers outside of Sweden and the US" says Dr Sudhanshu Patwardhan.

On Monday it was announced that PMI, Philip Morris International, is buying the Swedish snus manufacturer Swedish Match. As Vejpkollen previously reported, the The deal has been in the works since spring. This is now becoming a reality after PMI bought 82.5 per cent of the shares in the Swedish company. Initially, PMI wanted to secure a larger share, but has now decided to go ahead with the purchase anyway. The price per share was SEK 116.

Want to go smoke-free

PMI has already shown great interest in Swedish Match, or perhaps rather the snus and the distribution of smokeless nicotine products. This interest has grown stronger since PMI has declared that it wants to reduce its sales of cigarettes and smoking tobacco sharply, in favour of smokeless products.

"Today, 30 per cent of PMI's revenue comes from smoke-free products. The goal is for everything to do so. But it's a gradual process, and by 2025 it will be 50 per cent." said PMI's Nordic Science Editor. Claude Guiron to Vejpkollen earlier this year.

Changing an entire industry

Snus, along with e-cigarettes, nicotine pouches and heat-not-burn products, will be at the centre of PMI's strategy to achieve that goal. And according to Claude Guiron it is about broadening its product portfolio while challenging the rest of the industry to do the same. Simply stopping selling cigarettes is not sustainable, at least not at this stage.

"The problem is that if we stop selling cigarettes, someone else will sell them. So it's not very likely that someone will stop selling cigarettes overnight. We need to change an entire industry. It's about phasing out smoking. Smoke-free products can take up more space little by little," said Mr Perez. Claude Guiron to Vejpkollen in January 2022.

Wanted to avoid cigarette companies

PMI's purchase of Swedish Match has been criticised, not least because Swedish Match already owns a large part of the distribution of nicotine pouches and snus in Sweden. The risk of monopolisation and distorted competition have been the main arguments. Nonetheless both the European Commission authorised as Swedish The Financial Supervisory Authority finalised the deal earlier this year. 

The deal has also been criticised by several strong players among the shareholders who believe that the bid was too low. Others believe that Swedish Match should continue to work on their own launch snus and nicotine pouches globally, without interfering with cigarette manufacturers.

"A big step for harm minimisation"

At the same time, many international commentators and activists are hailing developments in the field of tobacco harm reduction, where snus, along with e-cigarettes and heat-not-burn technology, are seen as important tools for reducing the harm of smoking and nicotine use. The British doctor Sudhanshu Patwardhan sees the merger between PMI and Swedish Match as a major step in the right direction.

"Hopefully this will lead to easier access to harm reduction products for consumers outside of Sweden and the US. 80 per cent of smokers live in low and middle income countries and they are often forgotten when we look at the market for new nicotine products," he said. Snusforumet, the magazine of the Swedish Snus Manufacturers' Association.

Money and innovation

Phillip Morris can combine its huge assets and logistics with Swedish Match's innovative spirit, says Sudhanshu Patwardhan. And that could lead to a huge change, on a global scale, in both the debate around, and access to, harm minimisation.

"PMI is already a leader among tobacco companies in minimising harm to smokers. The big test will be to spread products like snus to the countries where smoking is most prevalent. There, availability, combined with a political will to introduce harm minimisation measures, can make a big difference," he says.

Keeps name and base in Sweden

Swedish Match history of snooping began in 1915 when the state-owned Svenska Tobaksmonopolet AB (STAB) was founded. In the 1900s, STAB merged with match manufacturer Svenska tändsticksaktiebolaget and became part of the Procordia group. In 1992, Procordia changed its name to Swedish Match. Today, the company has 7,500 employees and will continue to be called Swedish Match and be based in Sweden, promises PMI CEO Jacek Olczak.

Other Sources for this article:
Drugnews: Philip Morris completes purchase of Swedish Match

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