STOCKHOLM -Swedish Match, which is the target of an agreed $16 billion bid by Philip Morris International Inc, on Friday reported second-quarter operating profit just above market expectations, aided by growth in the United States.
Operating profit rose to 2.23 billion Swedish crowns ($22.47 million) from 1.96 billion a year earlier. Analysts polled by Refinitiv had on average forecast a profit of 2.19 billion crowns.
The company sells moist snuff “snus” in Scandinavia, cigars in the U.S. and tobacco-free nicotine product ZYN which, like snus, is put under the upper lip and which Chief Executive Lars Dahlgren said had shown an “impressive volume trajectory” in terms of sales in the quarter.
Group sales increased 23% to 5.56 billion Swedish crowns.
Marlboro maker Philip Morris in May made a bid of 106 crowns per share for Swedish Match, which competes with British American Tobacco and Altria.
Several shareholders, including Bronte Capital, Aberdeen and Elliott Investment Management, have been opposing the deal. Analysts say that could make completion difficult as the buyers need agreement from 90% of shareholders under Swedish law.
The acceptance period of the offer ends on Sept. 30. Swedish Match has suspended share repurchases while it runs.
($1 = 10.2370 Swedish crowns)
(Reporting by Supantha Mukherjee in Stockholm; editing by Niklas Pollard and John Stonestreet)