Philip Morris International Sells UK Inhaler Company Vectura for £150M Amid Backlash Over Controversial Acquisition of Asthma Device Maker
Fiona Nanna, ForeMedia News
4 minutes read. Updated 6:24PM GMT Wed, 18 September, 2024
In a significant shift reflecting both strategic reorientation and public criticism, Philip Morris International (PMI), the multinational tobacco corporation renowned for its Marlboro brand, has sold its UK inhaler subsidiary, Vectura Group, for £150 million ($198 million). This sale comes just three years after PMI’s high-profile acquisition of the inhaler manufacturer, which was completed for over £1 billion.
The initial purchase of Vectura in 2021 sparked substantial backlash, with critics accusing PMI of hypocrisy. The tobacco giant, which has long been associated with cigarette production, was criticized for its simultaneous investments in smoke-free products like vaping and its foray into the inhaler market, which is primarily aimed at treating respiratory conditions such as asthma.
In response to this backlash, PMI defended its acquisition as a strategic move towards diversifying its portfolio away from traditional tobacco products. The company has been vocal about its commitment to transitioning towards a “smoke-free” future, aiming for two-thirds of its sales to come from non-cigarette products by 2030.
The decision to divest Vectura was announced on Wednesday and is set to be finalized following regulatory approval. The sale to Molex Asia Holdings, an electronics firm, will involve an upfront payment of £150 million, with additional deferred payments potentially reaching up to £148 million, contingent upon meeting specific conditions.
Jacek Olczak, PMI’s CEO, stated that the sale is intended to release Vectura from the “unreasonable burden of external constraints and criticism” associated with PMI’s ownership. Despite this sale, Olczak emphasized that PMI remains dedicated to innovation in the inhaler sector, signaling that the company is not completely abandoning its involvement in this field.
This move comes at a time when PMI’s financial performance reveals a continued heavy reliance on cigarette sales. For the quarter ending in June, over 60% of PMI’s $9.47 billion (£7.19 billion) in sales were attributed to cigarettes, with PMI holding a 23.6% share of the global cigarette market by revenue. This has led to ongoing skepticism from health charities regarding the authenticity of PMI’s smoke-free commitment.
Amidst these corporate shifts, the newly elected Labour government in the UK is also contemplating an outdoor smoking ban at pubs, a proposal that has been met with both support from health experts and concerns from pub owners about potential impacts on their businesses.
Meta Description: Philip Morris International, the tobacco giant behind Marlboro cigarettes, has sold UK inhaler company Vectura for £150m following backlash over its previous acquisition. The sale reflects the company’s strategic shift towards “smoke-free” products.
