Swedish Match and Gum Tech form Joint Venture for Non-Tobacco Nicotine Products
12/21/1999 4:24 AM EST
Swedish Match and Gum Tech form Joint Venture for Non-Tobacco Nicotine
Products.
Swedish Match AB and Gum Tech International have reached an Agreement in
Principle to form a joint venture to explore new business opportunities in
the field of non-tobacco nicotine products. The joint venture will be
organized as an independent company for the purpose of developing,
manufacturing, marketing and distributing non-tobacco nicotine products.
Under the terms of the agreement, Swedish Match will own 51% and Gum Tech
will own 49% of the venture. Gum Tech will contribute intellectual
property and Swedish Match will contribute $10 million in start-up
capital.
Swedish Match, based in Stockholm, Sweden, develops, manufactures, markets
and distributes, through its own subsidiaries worldwide, a broad range of
tobacco products within the OTP (Other Tobacco Products) category, with
smokeless tobacco as its core business along with cigars and pipe tobacco,
as well as matches and lighters.
Gum Tech, based in Phoenix, Arizona, specializes in the development and
manufacture of functional chewing gum products.
"So far we have operated in the tobacco sector with emphasis on smokeless
tobacco. By this move we are looking into the possibilities of broadening
the scope of our core business" says Lennart Sundén, President and CEO of
Swedish Match. - "This joint venture provides a possibility to explore
further business opportunities by providing alternative products for the
smoker, who cannot or does not want to smoke", comments Lennart Sundén.
"Swedish Match has impressive know-how and expertise in the field of
marketing and distributing fast moving consumer products worldwide,
especially to the tobacco consumer", says Gary Kehoe, President of Gum
Tech. - "We believe there needs to be more alternatives for consumers in
the non-tobacco nicotine market. It is our goal to develop non-tobacco
nicotine products that are viewed by independent, public health
authorities, as well as the consuming public, as acceptable alternatives
to smoking from a health perspective", concludes Gary Kehoe.
The Joint Venture is subject to the execution of definitive agreements.
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Swedish Match is an international group with its head office in Stockholm.
The company produces an extensive range of OTP (Other Tobacco Products:
smokeless tobacco, cigars and pipe tobacco), matches and lighters, which
are sold in 140 countries. The company's sales for the 12-month period
ended September 30, 1999 were approximately MSEK 9.000. The Swedish Match
share is listed on the Stockholm Stock Exchange (SWMA) and NASDAQ (SWMAY).
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For further information, please contact:
Lennart Sundén, President and office +46-8-658 01 75
Chief Executive Officer
Sven Hindrikes, Senior Vice President and office +46 8 658 02 82
Chief Financial Officer
Bo Aulin, Senior Vice President, Corporate office +46 8 658 03 64
Affairs
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