- JT Group is buying Vector Group, known for its Liggett discount tobacco brand, for $2.4B.
- The acquisition will make Vector a wholly owned subsidiary of JT, with the deal expected to close in Q4.
- Howard Lorber’s future at Vector remains uncertain, but he may focus more on Douglas Elliman as it faces financial difficulties.
Japanese tobacco giant JT Group announced on Wednesday its acquisition of Howard Lorber’s Vector Group (VGR) for $2.4B, as reported in The Real Deal.
Deal Details
JT Group has agreed to purchase all outstanding shares of Vector Group for $15 per share in cash, representing a 29.9% premium over Vector’s 60-day volume-weighted average share price.
The deal is expected to close in Q4 making Vector a wholly owned subsidiary of JT Group. Vector’s stock recently closed at $13.99 per share, just below its 52-week high.
What It Means
Vector, the former parent company of real estate brokerage Douglas Elliman (DOUG), is best known for owning Liggett Group, a discount tobacco manufacturer, and New Valley, a real estate investment arm.
Lorber, who remains CEO of Vector, may soon have more time to dedicate to Elliman. The firm has been facing mounting challenges, including declining share prices, significant losses, and a recent scandal involving former top brokers Oren and Tal Alexander.
Investor Brad Tirpak has also pushed shareholders to vote against proposals related to Lorber’s compensation and board election terms at the company’s upcoming shareholder meeting.
Bigger Picture
Douglas Elliman, spun off into a public company in 2021, continues to grapple with financial difficulties.
Last month, two independent proxy firms supported Tirpak’s demands for changes at Elliman ahead of the shareholder meeting. Lorber’s contract with the brokerage is set to expire at the end of this year.
Despite the company’s challenges, Lorber earned more than $4.7M in 2023, excluding stock awards, an increase of over $600K from the previous year.
