Vector Group Ltd. (NYSE:VGR) shares are trading higher after the company reached a definitive agreement to be acquired by Japan's JT Group for a total equity value of about $2.4 billion.

Vector Group is a holding company for Liggett Group LLC, Vector Tobacco LLC, and New Valley LLC. Based in Geneva, Switzerland, JT Group's global tobacco business produces and sells renowned brands like Winston, Camel (outside the U.S.), MEVIUS, and LD in over 130 markets worldwide.

As per the agreement, JT Group will offer to acquire all outstanding shares of Vector Group common stock through a tender offer and second-step merger for $15.00 per share in cash, reflecting a 29.9% premium over the 60-day volume-weighted average share price.

The transaction, subject to customary closing conditions, is expected to close in the fourth quarter of 2024.

Howard M. Lorber, President and Chief Executive Officer of Vector Group, said, "This transaction delivers significant value to Vector Group stockholders and creates opportunities for our employees, who will become part of a leading global organization."

In July, Vector Group reported second-quarter adjusted EPS of $0.34, beating the consensus of $0.30, and sales of $371.914 million, exceeding the street view of $362.900 million.

Investors can gain exposure to the stock via Invesco S&P SmallCap Consumer Staples ETF (NASDAQ:PSCC) and Invesco S&P SmallCap High Dividend Low Volatility ETF (BATS:XSHD).

Price Action: VGR shares are up 7.58% at $15.05 premarket at the last check Wednesday.

Image by svklimkin from Pixabay

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