Swedish Match has signed a Letter of Intent with Scandinavian Tobacco Group to form a new worldwide company with focus on cigars

• Swedish Match to contribute all of its cigar business with the exception of US mass market cigars, as well as its remaining pipe tobacco and accessories businesses • Scandinavian Tobacco Group to contribute all of its tobacco business (cigars, pipe tobacco and fine cut tobacco) • Completion of the transaction is subject to due diligence by both parties, final transaction agreements, bondholder approval, and regulatory review and approval

Swedish Match produces and sells market-leading brands in smokefree tobacco products, cigars and lights products. The Company sells products across the globe, with production units in 10 countries. The Group’s global operations generated sales of 14,139 MSEK for the twelve month period ending September 30, 2009. The Swedish Match share is listed on the NASDAQ OMX Stockholm (SWMA).