The sale of Imperial Brands PLC premium cigar business has been completed.

Last month it had been announced that both parties had agreed to complete the transaction on October 29, 2020. This was a slight delay from the original September 30, 2020.

Under the agreement, Imperial Gemstone Investment Holding Ltd and Allied Cigar Corporation, S.L. had agreed to purchase the premium cigar business. The total consideration was €1,225 million, of which net cash proceeds of €1.1 billion will be used to reduce debt.

Under the terms of the agreement:

  • Gemstone Investment Holding Ltd will acquire Premium Cigar USA for a total consideration of €185 million (£162 million). This is the business of Tabacalera USA including the brands of Altadis U.S.A., the Internet catalog business of JR Cigars, and Casa de Montecristo retail locations.
  • Allied Cigar Corporation, S.L will acquire Premium Cigar RoW for a total consideration of €1,040 million (£912 million). This includes Imperial’s 50% stake in Habanos SA as well as the VegaFina brand, the Tabacalera de Garcia factory in the Dominican Republic, and the Flor de Copan factory in Honduras.

As announced on April 27, 2020, €88 million of consideration will be deferred for 12 months from today’s close, with a further €69 million deferred and contingent upon the transfer of the Dominican Republic factory, which is expected to complete in 2021. As subsequently announced on September 28, Imperial has provided a further six-month deferral of €250 million while the buyers finalize long-term financing arrangements.