Imperial Brands has agreed to sell its worldwide premium cigar businesses (“Premium Cigars”) for EUR 1.225 billion to use the money to reduce debt, the company announced in a press release.

The sale will take place in two transactions documented under two sale agreements: one for the USA business (“Premium Cigar USA”); and another for the Rest of the World business (“Premium Cigar RoW”). After adjusting for tax and other costs, the disposals are expected to realise net cash proceeds of around EUR 1.094 billion.
Gemstone Investment Holding Ltd will acquire Premium Cigar USA for a total consideration of €185 million. Allied Cigar Corporation, S.L will acquire Premium Cigar RoW for a total consideration of €1,040 million.
The transactions are expected to close in the third quarter of calendar year 2020. The Premium Cigar RoW transaction includes the sale of the Dominican Republic handmade premium cigar factory, which is expected to close in 2021, the press release said.
Joint Interim Chief Executives Dominic Brisby and Joerg Biebernick said: “We are delighted to be able to announce the sale of Premium Cigars in the current challenging global environment. It has been a complex transaction involving joint venture partners and assets across multiple geographies and we would like to thank everyone involved for working so hard to get the deal agreed.”
“This disposal reinforces our strategic ambition of becoming a leaner and more agile organisation and the proceeds will realise value for shareholders by reducing debt as part of our ongoing focus on active capital management.”
“We believe we have found the right long-term owners for Premium Cigars; they are committed to investing in the business to maximise future growth opportunities and are well positioned to further develop operations internationally,” they added.