Philip Morris gets EU approval to buy Swedish Match

The European Commission said Tuesday that U.S. tobacco company Philip Morris has obtained permission from the European Union's antitrust agency to buy Swedish Match for $16 billion. The acquisition comes despite the giant's earlier statements on selling its logistics business. 

As reported by the EU competition enforcer, the company had been asked to divest its Swedish Match’s unit, i.e. SMD Logistics. The aim is to eliminate potential competition issues for Philip Morris in the service sector.

However, the corporation still plans to extend their reach in the fast-growing market of cigarette alternatives. Sales of tobacco-free products are projected to peak in 2025, greatly boosting the group's revenues.

Swedish Match is known worldwide for producing various forms of tobacco substitutes. The range includes nicotine patches, cigars, and snus (a type of crushed tobacco placed between the gum and the lip), accounting for more than half of the global market.