The Danish company, Scandinavian Tobacco Group has announced that it reached an agreement with the shareholders of Royal Agio Cigars and will acquire a 100 per cent stake in the Dutch family-owned business, according to a company press release.
The shareholders of the Dutch cigar manufacturer said that the proposed sale of the company is “in the interest of long-term continuity of the activities and the brands of the family-owned business,” according to the press release. The company said that the acquisition has not been approved by the competition authorities and has not been submitted for advice to the works council yet. The transaction is expected to be completed in the first half of 2020, according to the press release.
In a statement, CEO of Royal Agio Cigars, Boris Wintermans, was quoted as saying, “This decision has not been easy. We have a wonderful company with highly committed employees and loyal business partners, some of whom have been working with us for over 50 years. But the combination of the two companies will be in a better position to deal with the financial consequences of ever-increasing legislation and regulations. We carry responsibility for the continuity of Agio and consider our decision to be inevitable in the long term. When the buyer came forward, we began constructive discussions regarding the benefits and resilience the combination of our companies could achieve.”
Royal Agio Cigars, which was founded in 1904, is known for cigar brands such as Agio, Balmoral, Penter and Mehari.
CEO of Scandinavian Tobacco Group, Niels Frederiksen, also commented on the acquisition, saying, “With its complimentary brands and the perfect fit of its geographical footprint, Royal Agio is a fantastic match with our existing business. I am delighted and proud at the same time that we have taken this important step in the acquisition process. Royal Agio is a company under excellent management with wonderful brands, a strong company culture and a rich history. I look forward to the moment when I can take on leadership of our combined business, which will offer our customers across the globe a highly attractive choice in cigars of the highest quality.”
The Danish Scandinavian Tobacco Group, which is a globally operating manufacturer of cigars, pipe tobacco and fine-cut tobacco and over 200 global grands, has been listed on Nasdaq Copenhagen since 2016.