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Imperial Brands Narrows Bidders for Cigar Divisions

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The sale of the Imperial cigar divisions is expected to be announced in the coming weeks and the bidding has been significantly narrowed, potentially to less than a handful of remaining bidders: one from Hong Kong, one from the Middle East and another consortium bid being represented by the former Davidoff management.

Up for grabs is the largest premium cigar group ever sold, which includes all of the premium cigar positions held by Imperial Brands, plc:

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  • Altadis U.S.A. — The company behind Montecristo, Romeo y Julieta and others in the U.S.
  • Casa de Montecristo — A chain of high-end retail stores, some owned by Imperial and others owned by franchise operators.
  • Flor de Copan — A cigar factory in Honduras.
  • 50 percent stake in Habanos S.A. — A joint-venture with the Cuban tobacco monopoly in the company that controls the sales and marketing of Cuban cigars worldwide.
  • JR Cigar — The second-largest cigar retailer in the world.
  • Tabacalera de García — The world’s largest cigar factory.
  • Stakes in local Habanos distributors around the world

Analysts at Jefferies estimate that Imperial could generate $1.3-2 billion from the sale of the premium business. They also estimate that the premium cigar business generates $450 million in revenue and earns $111 million in profit annually.


Over the last few months, Imperial has fielded bids from all over the world. Some bidders—like Altadis rival Scandinavian Tobacco Group (STG)—only bid on a portion of the package, while others offered to take all cigar-related businesses. Some wanted just the stakes in the Cuban cigar business, others—like STG—wanted to avoid Cuba altogether.

Multiple sources told halfwheel that the bidding had been narrowed to two or three groups.

One is a Hong Kong-based group that has no experience in the cigar business. halfwheel has been unable to independently verify the name of the company. halfwheel reached out to a representative for the company but has not heard back.

Many have pointed to China National Tobacco, the world’s largest tobacco company. China Tobacco is based in Beijing, not Hong Kong, and is not believed to have taken part in the bidding process.

The other is far more interesting, a consortium bid being represented by Hans-Kristian Hoejsgaard, the former ceo of Oettinger Davidoff AG.

Hoejsgaard confirmed to halfwheel that he was part of a bid, which he described as a mixture of family offices from Asia, India and the Middle East, some of which had cigar experience and others had luxury businesses.

Charles Awad, who worked as the director of marketing and innovation at Davidoff during Hoejsgaard’s tenure, is also part of the group.

The third bidder is tied to Phoenicia T.A.A. Cyprus Ltd., the powerful Middle Eastern distributor of Cuban cigars. It’s unclear whether that bid is still active as some sources have told halfwheel that the bids have been narrowed to two and that the Phoenicia-related bid had been rejected.

When asked about whether the company had narrowed its bids to two, an Imperial spokesperson provided the following statement:

The divestment of our premium cigar business is progressing well. We are at an advanced stage of the process and expect to make a further announcement in the coming weeks. The opportunity has generated interest from a number of potential buyers but we are unable to provide any further detail at this time.

Imperial is selling the cigar brands as part of a £2 billion ($2.44 billion) divestiture of assets to help pay down its debt. AZ Capital S.L., a Madrid-based investment bank, is advising Imperial on the sale.

Last week, Allison Cooper—ceo of Imperial Brands, plc—announced her resignation.

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Charlie Minato
About the author

I am an editor and co-founder of halfwheel.com/Rueda Media, LLC. I previously co-founded and published TheCigarFeed, one of the two predecessors of halfwheel. I handle the editing of our written content, the majority of the technical aspects of the site and work with the rest of our staff on content management, business development and more. I’ve lived in most corners of the country and now entering my second stint in Dallas, Texas. I enjoy boxing, headphones, the Le Mans 24-hour, wearing sweatshirts year-round and gyros. echte liebe.

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