Scandinavian Tobacco Group will acquire the holding company of the Royal Agio Cigars group for €210 million ($232.47 million).
Royal Agio’s portfolio includes brands such as Mehari´s, Panter and Balmoral. Based in Duizel, Netherlands, the company has approximately 3,200 full-time employees. Royal Agio’s reported annual net sales full year 2018 were €133 million with an EBITDA of €18 million.
The company was featured in the August edition of Tobacco Reporter.
Royal Agio provides Scandinavian Tobacco Group access to a strong product portfolio and important market positions in key European machine-made cigar markets. The acquisition can help Scandinavia Tobacco Group secure leading positions in France, Belgium and The Netherlands and significantly improve its position in key cigar markets such as Spain and Italy.
If the transaction is completed, the proforma combined group net sales for 2018 would be approximately DKK7.7 billion ($1.14 billion) with a combined workforce of more than 10,000 employees.
“I am very pleased and proud that we have taken this important step towards an acquisition of Royal Agio,” said Niels Frederiksen, CEO of Scandinavian Tobacco Group.
“If completed, the acquisition will be an important step in our ambition of becoming the global leader in cigars, as it significantly strengthens our position in several key machine-made cigar markets in Europe and enables us to deliver an attractive range of cigars of the highest standards to our consumers.”
The transaction is subject to satisfactory conclusion of a statutory employee consultation process in the Netherlands and subsequent completion will require approval from competition authorities in certain European jurisdictions.
Scandinavian Tobacco Group expect the transaction to conclude in the first half of 2020.