Royal Agio Cigars Sold To Parent Group of General Cigars
The parent company of General Cigars, Scandinavian Tobacco Group has completed a deal for the acquisition of all of the shares of Agio Beheer B.V. from Highlands Beheer B.V. Agio Beheer B.V. is the holding company of the Royal Agio Cigars. The transaction is valued at EUR 210 million (UD 231 millon).
The Scandinavian Tobacco Group acquisition will be financed by cash at hand and debt. 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. Completion of the transaction depends on the above-mentioned processes but is currently expected to occur in the first half of 2020.
According to a press release, Royal Agio is a leading European cigar company with a strong cigar portfolio including key brands such as Mehari´s, Panter and Balmoral. The company is based in Duizel, The Netherlands and has approximately 3,200 full-time employees. Royal Agio’s reported annual net sales full year 2018 were EUR 133 million (DKK 995 million) with an EBITDA of EUR 18 million. Royal Agio can provide Scandinavian Tobacco Group access to a strong product portfolio and important market positions in key European machine-made cigar markets.
CEO of Scandinavian Tobacco Group, Niels Frederiksen says: “I am very pleased and proud that we have taken this important step towards an acquisition of Royal Agio. 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.”
While the move might not seem a big deal here in the United States, it is expected that the acquisition will help solidify the footprint of Scanadanavian Tobacco Group in Europe, specifically the machine made market place in countries such as France, Belgium, and Netherlands while improving other markets such as Italy and Spain.
Be sure to tune into The Cigar Authority podcast this weekend as we discuss this acquisition as well as look at the possibility of more to follow.