Altria Group (NYSE:MO) has signed a non-binding collaboration deal with South Korean tobacco and consumer products company KT&G, to explore opportunities in non-nicotine products and smoke-free nicotine products.
“We believe the complementary market experience and capabilities of our two companies can accelerate the pursuit of our long-term adjacent growth goals across international regions and adjacent product categories,” Altria CEO Billy Gifford said.
“Through our collaboration, we secured a path to growth in next-generation tobacco products by expanding our business from cigarettes to nicotine pouches and other areas. KT&G and Altria will seek to maximize synergies based on our capabilities and expect to accelerate innovation across the nicotine and non-nicotine spaces.” KT&G CEO Kyung-man Bang said.
The two tobacco giants will explore opportunities to expand the distribution of nicotine pouch products to select countries, including Altria’s On! and On! Plus product range, and other strategic transactions.
As part of the collaboration, an Altria subsidiary has agreed to acquire an ownership interest in Nordic-based nicotine pouch company Another Snus Factory Stockholm, which owns the LOOP brand internationally. This transaction will be concurrent with KT&G’s acquisition of ASF.
In addition, KT&G subsidiary Korea Ginseng Corp. will also partner with an Altria subsidiary for opportunities in the U.S. energy and wellness segment.