LORILLARD, the third largest American cigarette manufacturer, yesterday took a stake in the UK’s burgeoning e-cigarette market by snapping up manufacturer Skycig in a deal worth up to £60m.
“We chose to move forward with Lorillard for the exceptional resources and expertise which the company can provide to enable Skycig to further both our product innovation and availability,” said Skycig co-founder Tom Rolfe.
The deal provides Lorillard entry to the UK market in much the same way that it entered the US e-cigarette market with its purchase of Blu eCigs in April 2012.
Lorillard held 40 per cent of the US e-cigarette market during the first half of 2013, with total sales of $1.8bn in the three months to 30 June.
Today members of the e-cigarette industry will meet with the Committee of Advertising Practice to examine advertising guidelines after the Advertising Standards Authority banned a number of e-cigarette TV ads last week following complaints by viewers that the ads did not show that the products contain nicotine.
FF&P Advisory worked with e-cigarette firm Skycig on its deal with Lorillard, with Mark Winkler as lead adviser.
Mark Winkler has been an associate director at the firm since 2012, and has previously advised a number of companies on deals, including Graphite Capital on its acquisition of Protocol Education for £31m in 2011 and Gorkana on its sale to Exponent in 2010 for £25m.
On the Skycig deal Winkler said: “Skycig has achieved unrivalled success in a short space of time through its ability to identify and satisfy consumer demand, whilst having the foresight to create a long term platform for growth.
“We’re run a tight process over the past few months, there has been a lot of strong interest in Skycig, but Lorillard is a very strong partner,” he told City A.M. yesterday.
Prior to joining FF&P, Mark was a director at Deloitte, where he initially qualified as a chartered accountant before joining its corporate finance advisory business in 2004.
FF&P has a long history of offering corporate finance advice to businesses, having previously advised companies including Qwasi on its $2.5m series A fundraising in 2012 and helping a private investor with its £43m acquisition of the Office Group, a specialised serviced office business, in 2010.