Imperial Brands Is Latest Tobacco Company to Look at Pot
(Bloomberg) -- Imperial Brands Plc Chief Executive Officer Alison Cooper signaled the U.K. tobacco company’s possible interest in expanding more in cannabis as the industry seeks new avenues to combat the continuous decline in smoking.
“It’s an interesting space to explore,” Cooper said in a Bloomberg Television interview Wednesday. The maker of Winston cigarettes is studying the market, she said, though it hasn’t made any commitments beyond the announcement in June of an investment in Oxford Cannabinoid Technologies, a startup linked to Oxford University that’s developing treatments derived from the marijuana plant.
Imperial Brands’s stock rose as much as 3.6 percent in London trading, an unusually steep move. Any mention of an interest in the legal-cannabis market has lifted company values lately, benefiting players as diverse as New Age Beverages Corp. and IntelGenx Technologies Corp. Imperial is interested in a niche that’s emerging between recreational and medicinal uses, Cooper said, calling the segment “wellness.”
“It covers a wide range of mood-enhancing types of aspects, things like helping you get to sleep at night or wind down,” she said. “We want to understand it more.”
Separately, Cooper said that the first market for Pulze, Imperial’s first heated-tobacco product, will be Japan. The company unveiled the device Tuesday, predicting that such smoking alternatives may add as much as 1.5 billion pounds ($2 billion) in revenue in 2020. Pulze will start out in Japan because smokers there are more familiar with such devices, according to Cooper. Sales will begin early next year.
Philip Morris International Inc. has said more than 5 million people in that country use its iQOS heat-not-burn product.
Despite the entrance into the new segment, the company continues to consider that the market for electronic cigarettes, which don’t contain tobacco, has more potential than heat-not-burn, Cooper said. “We’re going to be driving the vapor opportunity,” she said.
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