Swedish Match, union agree on five-year contract

Jun. 28—Swedish Match USA and the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union Local 196T have reached an agreement on a new five-year contract.

The company, located at 1121 Industrial Drive, said the agreement covers nearly 500 workers in Owensboro.

No details were provided.

"This new agreement is very important for our employees, our customers, our shareholders and for the community," Shane Dukes, director of operations in Owensboro, said in a news release.

"Swedish Match's commitment to innovation, and its market-leading nicotine pouch brand, ZYN, has significantly expanded Swedish Match's investment in its employees and the Owensboro community," he added.

Dukes said, "Swedish Match is also committed to producing high quality products, and this new five-year agreement demonstrates the company and the union's commitment to working together to keep these jobs, with attractive wages, benefits and working conditions in Owensboro."

Joy Everly, vice President of human resources and administration, added, "Representatives from both the company and the union worked hard for an agreement that addressed issues important to all of us, such as healthcare, retirement, efficiencies and job stability and by the end of our discussions, we were successful in negotiating a mutually beneficial agreement that addresses all of those concerns."

Attempts to reach union officials were unsuccessful.

The company, based in Sweden, is in the process of being sold to Philip Morris International.

In May, Swedish Match's board of directors recommended that the company's shareholders accept the offer of to buy more than 90% of its shares in a deal reportedly worth $16 billion.

The Owensboro plant has 746,641 square feet under roof on its 44.5-acre site with 637 employees.

The property is assessed at $12.39 million.

In a statement released last month, Philip Morris indicated that employees will be safe if and when the purchase is completed.

The statement said, "PMI recognizes that the employees and management team of Swedish Match have built a highly successful business with an excellent track record, and PMI has the utmost respect for them. PMI's current plans for the future business and general strategy do not include any material changes with regard to Swedish Match's operational sites, or its management and employees, including their terms of employment."

It added that "Swedish Match has a complementary organization with a talented, dedicated workforce, excellent culture and a strong base of skills in Sweden, the U.S. and across the world. PMI would intend to nurture this talent and provide additional opportunities as the companies grow together.

"Importantly, PMI intends to provide compensation and benefits consistent with Swedish Match's current programs, including the Profit Sharing Foundation in Sweden."

Swedish Match's Owensboro-made ZYN nicotine pouches are the No. 1 nicotine pouch in the United States, with 173.9 million cans sold in more than 120,000 stores last year.

Worldwide sales were 198 million cans in 20 countries.

Financial Times reported that PMI has said it will pay $10.57 per share for Swedish Match's stock — a premium of 39% above the closing price on May 9, before talks between the companies became public.

It was at $9.98 on Monday.

Keith Lawrence, 270-691-7301 klawrence@messenger-inquirer.com