Tobacco maker Philip Morris (PMI) acquired asthma inhaler maker Vectura for £ 1.1 billion on Thursday, gaining the support of British company shareholders despite concerns from medical professionals.
Vectura shareholders have decided to take an offer of 165p / share from PMI, with nearly 75% supporting the deal.
The acquisition of a London-listed inhaler manufacturer is part of Philip Morris’ long-term plan to develop “non-smoking” products and switch to “broader health care and wellness” companies.
But it has offended health groups such as the British Asthma and the British Lung Foundation, who are wondering if the Tobacco Group should own a company that treats the very respiratory illnesses caused by tobacco.
Jacek Olczak, CEO of PMI, argues that the acquisition of Vectura is an important part of his strategy to move the company “beyond nicotine.”
He told a telegram last month that opponents of the deal were “not interested in progress” and accused the tobacco industry of “solving old scores.”
Olczak said Thursday that PMI will provide Vectura scientists with the resources and expertise to reach the goal of generating at least $ 1 billion in net revenue from Beyond Nicotine products by 2025.
Meanwhile, Asthma UK and the British Lung Foundation said they had sent a letter urging the government to investigate the issue of conflict of interest.
This letter was co-signed by 35 charities, public health professionals, and clinicians.
“Vectura’s handling of large tobacco poses a very real risk that the tobacco industry could overwhelm UK health policy,” said the Chief Executive Officer of the UK Asthma and UK Lung Foundation. One Sarah Woolnow said.
“To prevent this, we urge the Government to uphold its commitment to the World Health Organization’s Framework Convention on Tobacco Control,” Woolno added.
PMI is regulatory approved for this transaction and cannot withdraw its offer following the open bidding process.
The company received a 50% threshold to make the offer unconditional, but has not yet reached 75% of the shares required to exclude Vectura.
PMI said it would extend the proposal to September 30 to give Vectura shareholders time to accept the proposal.
“Philip Morris doesn’t ignore elephants. It’s been a long-standing harsh view on us all. The discomfort is good and tends to make a difference, but the promised changes happen and the journey is detoured. You have to be careful not, “said Danny Hughson, financial analyst at AJ Bell.
($ 1 = 0.7234 pounds)
By Pushkala Aripaka and Siddharth Cavale
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