Japan Tobacco Inc. sold its 2.1% stake in Korea Tobacco & Ginseng Corp., Pulse reported Dec. 4, citing investment banking sources.
Sources reportedly told the news site that Citigroup Global Markets identified investors to sell the Tokyo-based company's 2,864,094 shares for 94,000 South Korean won apiece in a block deal. Proceeds from the sale are expected to reach 269.4 billion won.
The move marks an end to Japan Tobacco's decadelong partnership with Korea Tobacco & Ginseng, or KT&G, the report added. The reason for the sale, which came at a 2.8% discount to KT&G's closing share price on Dec. 3, was not revealed.
Experts reportedly said Japan Tobacco may no longer have an incentive to maintain the partnership since it moved its former Korean production to the Philippines in 2017. Others suggested that the company could be trying to boost its balance sheet following a number of acquisitions over the past three years.
Japan Tobacco and KT&G did not immediately respond to S&P Global Market Intelligence's request for comment.
As of Dec. 3, US$1 was equivalent to 1,190.46 South Korean won.