Philip Morris International said Thursday it had increased its offer for smokeless tobacco company Swedish Match, as the US group looks to steer away from its traditional cigarette business.
Philip Morris hiked its offer from 106 to 116 kronor per share - bringing the total offer to 176.4 billion kronor (£14 billion) - and said it would not raise it further.
While this is an increase from the original offer in May, it represents a drop in dollar terms from $16.16 billion due to currency movements.
Jacek Olczak, Philip Morris chief executive, said the revised offer was "compelling value for the shareholders of both Swedish Match and PMI".
He added that the "deterioration in the global economic outlook, equity markets and the interest rate environment since the time of the initial offer strengthens yet further the attractiveness of the revised offer to Swedish Match's shareholders."
If the offer is not accepted, Philip Morris said it was "well prepared to proceed autonomously" to develop its smoke-free products.
Stockholm-based Swedish Match derives more than 65 per cent of its revenue from smoke-free products, including chewing tobacco and the Zyn brand of nicotine pouches.
The group is also known for making cigars and "snus", a form of snuff particular to Nordic countries.
Philip Morris announced in 2016 a long-term goal to stop selling cigarettes and replace them with alternatives that it says are less harmful.
The US company sells cigarette brands such as Marlboro and Chesterfield in 180 markets outside the United States and has invested billions of dollars since 2008 in vapor products, oral nicotine and other "reduced-risk" products.
Last year it clinched a controversial takeover of British breathing inhaler manufacturer Vectura, despite fierce opposition from health campaigners and medical groups.
The group plans to generate at least $1 billion in annual net revenues from nicotine-free products by 2025.
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