1. What Happened?: KT&G Acquires 51% Stake in ASF

On September 23, 2025, KT&G signed a contract to acquire a 51% stake in the Swedish nicotine pouch company ASF for 102.7 billion KRW. This investment represents 1.10% of KT&G’s capital.

2. Why is it Important?: Securing New Growth Engine and Market Diversification

The acquisition of ASF is a significant step towards diversifying KT&G’s business portfolio, which is currently concentrated on cigarettes and HNB (Heat-not-Burn), and entering the rapidly growing nicotine pouch market. This is expected to contribute to creating new revenue streams and securing future growth amid strengthening regulations.

3. What’s Next?: Analyzing Opportunities and Risks

Positive Impacts

  • New Growth Engine: Entering the rapidly growing nicotine pouch market secures a new growth engine.
  • Strengthened Global Competitiveness: Building upon the HNB partnership experience with PMI, KT&G can potentially expand into the global nicotine pouch market.
  • Business Diversification: Reduces dependence on the existing tobacco business and establishes a stable revenue structure through portfolio diversification.

Negative Impacts and Considerations

  • Increased Financial Burden: Possibility of increased financial burden due to the 102.7 billion KRW investment. Careful monitoring is required considering the increasing debt ratio trend.
  • New Business Risks: Preparation is needed for uncertainties in the nicotine pouch market (regulatory changes, intensified competition, etc.).
  • Synergy Creation: The key is how much synergy can be created with existing businesses.

4. What Should Investors Do?: Investment Strategy Recommendations

  • Maintain a Long-Term Perspective: Focus on long-term growth potential rather than short-term volatility.
  • Monitor Financial Health: Continuously check financial indicators such as changes in the debt ratio.
  • Track New Business Performance: Consistently analyze whether market competitiveness is secured and synergy is created after the ASF acquisition.
  • Consider Macroeconomic Variables: Understand the impact of macroeconomic variables such as exchange rates and interest rates and reflect them in investment strategies.