Vector Group's stock up 8% on news to be acquired by Japan's JT Group in $2.4 billion tobacco deal

By Ciara Linnane

All-cash deal is expected to close in the fourth quarter

Vector Group Ltd.'s stock (VGR) jumped 8% Wednesday after the diversified holding company said it's agreed to be acquired by Japan's JT Group in a deal with a total equity value of about $2.4 billion.

Under the terms of the deal, Tokyo-based JT, which makes and sells some of the best-known cigarette brands - including Winston and Camel outside the U.S. - will pay $15 a share in cash, equal to a 29.9% premium over Vector's 60-day volume-weighted average share price.

Miami-based Vector is a holding company for cigarette products and also has real-estate interests.

The boards of both companies have approved the deal, which is expected to close in the fourth quarter. It will be conducted as a tender offer and second-step merger. After the deal closes, Vector is to become a wholly owned unit of JT.

"Vector Group and JT Group share a commitment to quality and excellence and providing consumers an outstanding value proposition in the U.S. cigarette market," said Howard M. Lorber, chief executive of Vector, in prepared remarks.

Vector's stock has gained 34% to date in 2024, while the S&P 500 has gained 17.3%.

-Ciara Linnane

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08-21-24 1334ET

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