JT Group to Acquire Vector Group in Deal Valued at $2.4B
MIAMI — JT Group, a Tokyo-based tobacco, pharmaceuticals and processed food manufacturer, entered into a definitive agreement to acquire Vector Group Ltd., the fourth largest tobacco company in the United States.
Under the terms of the agreement, JT Group will offer to acquire all outstanding shares of Vector Group common stock for $15 per share in cash, which represents a premium of 29.9% over the 60-day volume-weighted average share price, or approximately $2.4 billion of total equity value, through a tender offer and second-step merger.
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After closing, Vector will become a wholly owned subsidiary of JT Group. The latter believes this will improve its return on investment on combustibles with a growing and historically profitable business brought under its umbrella, as well as significantly expand its presence in the U.S.
"Vector Group and JT Group share a commitment to quality and excellence and providing consumers an outstanding value proposition in the U.S. cigarette market," said Howard M. Lorber, Vector president and CEO. "This transaction delivers significant value to Vector Group stockholders and creates opportunities for our employees, who will become part of a leading global organization."
The boards of directors of both companies have already given unanimous approval for the transaction, which is still subject to customary closing conditions, including the tender of a majority of the outstanding shares of Vector Group and the receipt of applicable regulatory approvals. The transaction is expected to close in the fourth quarter of 2024.
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Jefferies served as exclusive financial advisor, while Sullivan & Cromwell served as legal advisor to Vector Group on the agreement. J.P. Morgan Securities and J.P. Morgan Securities are serving as exclusive financial advisor to JT Group, while Ernst & Young Tax Co. acts as its financial and tax advisor and Freshfields Bruckhaus Deringer US as its legal advisor.
JT Group's global tobacco business, headquartered in Geneva, Switzerland, manufactures and sells some of the world's best-known brands in 130-plus markets worldwide, among which include Winston and Camel (outside the U.S.), as well as MEVIUS and LD.
Vector Group is a holding company for Liggett Group, Vector Tobacco and New Valley .