JT Group has agreed to buy discount cigarette-maker Vector Group for about ¥348.6 billion ($2.4 billion) to expand in the U.S., changing tack after war closed off its path for growth in Russia.
The Japanese tobacco company plans to acquire all of Miami-based Vector for $15 a share, according to a statement Wednesday. The purchase price represents a 7.2% premium to Vector’s closing price on Tuesday in New York.
The deal will boost Japan Tobacco’s U.S. market share from 2.3% to about 8% and give it ownership of two of the top 10 U.S. cigarette brands, according to Eddy Pirard, CEO of JT International. The U.S. is the world’s most profitable market for tobacco firms.