EXCLUSIVE-Philip Morris to get EU approval for Swedish Match with asset sale -sources

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By Foo Yun Chee

BRUSSELS, October 24 (Reuters)Marlboro maker Philip Morris PM.N is set to get EU antitrust approval for its $16 billion bid for Swedish Match SWMA.ST after offering to sell the target’s logistics business, people familiar with the matter said on Monday.

Philip Morris, which in May announced the deal to expand its presence in the fast-growing cigarette alternatives market, submitted the concession to the European Commission earlier this month.

The American company aims to increase the sale of smoke-free products to more than half of its turnover by 2025.

Stockholm-based Swedish Match controls about half of the global market for snus, a Scandinavian moist oral tobacco product that users place behind their upper lip, and is also the world leader in the nicotine pouch industry.

The European Union’s competition authority, which is due to rule on the deal by October 25, declined to comment. Philip Morris and Swedish Match also declined to comment.

Philip Morris raised its bid for Swedish Match last week in a bid to convince shareholders awaiting a softer offer.

Hedge funds, including Elliott Management Corp, increased their stakes in Swedish Match in hopes of a higher bid.

Under Swedish law, 90% of Swedish Match shareholders must approve the offer by November 4. Philip Morris sticks to this acceptance rate.

(Reporting by Foo Yun Chee; Additional reporting by Anna Ringstrom and Marie Mannes in Stockholm; Editing by Jan Harvey and Alexander Smith)

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