Abstract
On February 10, 2016, Lars Dahlgren and Marlene Forsell, CEO and CFO of Swedish Match, were reviewing their plans for how best to use the large cash flows that would flow from the ongoing divestiture of their cigar business, the Scandinavian Tobacco Group, STG. STG had been formed as a joint venture between Swedish Match and Danish company in 2010, and its business was cigars and pipe tobacco. STG had been listed on the Danish stock market in an initial public offering (IPO) the same morning. In the IPO, Swedish Match had divested some of its STG shares, generating cash of SEK2.1 Billion. At the listing share price, the remaining shareholdings had a market value of SEK3.7 Billion.