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American Military News
04-07-2025
- Business
- American Military News
INTERVIEW: Secret deal means Laos has some of the world's cheapest cigarettes
This article was originally published by Radio Free Asia and is reprinted with permission. A pack of cigarettes in Laos costs as little as 32 U.S. cents, thanks to a secret deal between the Lao government and British tobacco giant, Imperial Brands. In a new report, The Examination, a news site that focuses on global health threats, looks into who benefited from the 2001 deal and how an agreement capping excise taxes has hit government revenues in the Southeast Asian nation and kept the price of cigarettes among the lowest in the world. That's had serious public health consequences for Laos, which has very high rates of smoking. Radio Free Asia's Mat Pennington spoke with Jason McLure, an investigative journalist with The Examination who reported the story. The interview has been edited for length and clarity. RFA: Can you tell us about the deal? Jason McLure: This story is about a deal that dates to 2001 when the communist government of Laos was privatizing the country's state tobacco monopoly. Now, what they did instead of having an open tender … they basically invited Imperial Brands and a local company called ST Group, run by a local businessman named Sithat Xaysoulivong, to bid on this. And ultimately what the Lao government decided to do was to form a joint venture with Imperial Brands and Mr. Sithat Xaysoulivong and his ST Group. Now, the way this was done was very unusual and it also highlighted some very close political connections between Mr. Xaysoulivong and the Lao government at the time. RFA: So who really benefited from this? And what was the fiscal impact for the Lao government? Did they lose revenue? McLure: The way the deal was structured was the Lao government retained 47% of the tobacco monopoly and Imperial Brands, this British tobacco giant, got 34%. The remaining 19% of the company was owned by this offshore company called S3T which, we know and learned was owned partly by Imperial Brands and partly by Mr. Sithat Xaysoulivong who, as it happened, was an in-law of the Lao prime minister at the time, Bounnhang Vorachit. So there was clearly some familial relationship involved. And ultimately this deal paid $28 million over basically two decades to the former prime minister's in-law. And this had big consequences for the Lao government. One tobacco control group did a study of the consequences of this deal on public health, and what they found was that the Lao government missed out on $143 million in tobacco tax revenue and that is because one provision of this tobacco contract capped cigarette excise taxes and essentially left Laos with some of the cheapest cigarettes in the world. RFA: How much is a packet of cigarettes in Laos? McLure: The cheapest brands of cigarettes in Laos cost about 7,000 kip. That's about 32 U.S. cents. So, we were able to look at WHO (World Health Organization) data from all around the world and find that basically these are some of the very cheapest cigarettes in the world. RFA: So what have been the health impacts of this? McLure: So the health impacts, they really have been significant in Laos. As in many other Asian countries, relatively few women smoke, but somewhere around 37 to 40% of men smoke. So there's a very high smoking rate there. It's one of the highest in the world, at least among men. And this is in part a direct consequence of these very cheap cigarettes that are a consequence of this 25-year contract that was signed back in 2001. Now, there's a lot of data, a lot of research from tobacco control researchers and public health researchers that show the best way to cut smoking rates to get people to quit smoking, or especially to prevent them from starting to smoke, is to increase the price of cigarettes. And the way that governments can do this is by increasing tobacco excise taxes. Now, this 25-year contract in Laos absolutely prevented the Lao government from doing that. RFA: And as we know, Laos is one of the poorest countries in Asia, and it doesn't have a very well-developed health system. So you can see what the sort of impacts would be. McLure: That's right. One of my colleagues visited one of the government hospitals in Laos, and she interviewed people who were there with smoking-related diseases. And the treatment was extremely expensive. And even for many people who have common smoking-related diseases like emphysema or lung cancer … particularly people in the countryside, people in villages, any form of radiation or chemotherapy or treatments like that are going to be out of reach. RFA: So what does Imperial Brands say about this? McLure: During our reporting, we reached out to Imperial Brands to ask them about this contract and specifically to ask why they decided to include an in-law of the prime minister at the time as part of this contract. And what they told us was that, for one thing, they said they comply with all regulations and generally behave in an ethical manner. But they didn't respond to the substance of our questions. We asked them as well about why this contract was kept secret for so long. The contract, in fact, itself, contained a secrecy provision. They told us that this type of confidentiality is normal in such commercial arrangements. RFA: And did the Lao government respond at all to any of your inquiries or Mr. Sithat Xaysoulivong or Mr. Bounnhang Vorachit? McLure: Unfortunately, the Lao government, Mr. Vorachit, Mr. Sithat, even the current Lao Prime Minister Sonexay Siphandone, they did not respond to our inquiries for this story. RFA: I understand that this isn't a problem that's totally isolated to Laos, that major tobacco companies have reached deals with authoritarian countries and other nations. McLure: That's right. You know, what's really a little bit unusual about this deal is that we were able to get the documents that showed exactly how the payments flowed from the Lao tobacco company and Imperial to the in-law of Laos' then prime minister. But we've seen that British American Tobacco, another one of the tobacco giants, has been involved in dealings with the North Korean regime in violation of U.S. sanctions. In fact, they agreed to pay more than $620 million as part of a deferred prosecution agreement with the U.S. Justice Department as a result of that. RFA: So what's the future of this agreement in Laos? I understand that it's coming up to its term now. McLure: Well, that is an interesting question because this is a 25-year agreement that was signed in 2001. It will expire next year. Now, the government of Prime Minister Sonexay Siphandone has already informed Imperial that they won't be renewing this agreement again. However, they did leave the door open to negotiating a new agreement with the same tobacco company. We'll see if that comes to pass and whether or not any insiders like Mr. Sithat, the in-law of former Prime Minister Vorachit, are involved. One thing that we do know is that Mr. Sithat is also close to the family of the current Prime Minister Sonexay. So it remains to be seen. Ultimately, what we've been told is that the current prime minister will be the one making the decision. And as we've seen, this could have huge impacts on the future of smoking in Laos and on Laos' public health. The Examination is a nonprofit newsroom that investigates global health threats. Their investigative report was supported in part by a grant from the Pulitzer Center.
The Sun
19-06-2025
- Business
- The Sun
Cigarette taxes blow £1.4BILLION black hole in Treasury coffers – as smokers turn to black market
PUNITIVE tobacco taxes have blown a £1.4 billion black hole in Treasury coffers, as smokers turn to black market cigs. A whopping £3.1bn in excise tax from a range of goods was lost last year to smugglers, counterfeiters, and illegal sellers as Brits ditch official shops for cheap, dodgy goods. That's enough cash to pay the wages of over 60,000 nurses or hand out Winter Fuel Payments to every pensioner in the UK. The biggest tax gap came from fags, followed by beer, which had hole of £700m. Stephen Rooney from Imperial Brands said: "These concerning figures expose the size and scale of Britain's growing, illegal tobacco black market, which is now depriving the Treasury of billions in lost tax every year. " Smoking rates are not falling, and ever increasing duties are instead pushing customers to the lawless black market, which doesn't pay a penny in tax.' One in four fags in the UK now comes from the black market, where a pack can cost as little as £5, over three times cheaper than a legal pack of Marlboro Gold in British supermarkets. In just three years, duty-paid cigarette sales have plunged nearly 45 per cent, from 23.6 billion in 2021 to just 13.2 billion now. Rolling tobacco sales have also been slashed almost in half. Yet smoking rates aren't falling and have instead crept up in some parts of England for the first time in nearly 20 years, according to University College London research. Reform Deputy Leader Richard Tice said: 'Hard working Brits, feeling the squeeze in their pockets, are turning to under the counter options, and who can blame them? 'The government's tax policy is pricing them out of legitimate goods. 'Labour chooses not to partner with above board businesses, but with organised criminal gangs instead.'
Cision Canada
19-06-2025
- Business
- Cision Canada
Auxly Announces Non-Binding Agreement to Amend and Extend BMO Credit Facility and Settlement of all Amounts owing to Imperial Brands
TORONTO, June 19, 2025 /CNW/ - Auxly Cannabis Group Inc. (TSX: XLY) (OTCQB: CBWTF) (" Auxly" or the " Company"), a leading consumer packaged goods company in the cannabis products market, is pleased to announce that it has entered into two agreements that will strengthen its balance sheet, reduce debt, and support long-term growth: A non-binding agreement (the " Term Sheet") to amend and restate the Company's existing syndicated credit facility led by the Bank of Montreal (" BMO"), and An exchange agreement (the " Exchange Agreement") with Imperial Brands plc (" Imperial Brands") pursuant to which all amounts owing by the Company under the outstanding convertible debenture held by Imperial Brands (the " Debenture") will be settled in common shares of the Company (" Shares") and pre-funded warrants to purchase Shares. These transactions represent meaningful progress in the Company's ongoing efforts to strengthen its balance sheet. The restatement of the credit facility will enhance the Company's liquidity and provide increased flexibility to allocate capital toward strategic growth initiatives. Concurrently, the settlement of the Imperial Brands convertible debenture through the issuance of equity instruments will eliminate over $21 million of debt from the Company's balance sheet. This deleveraging will improve the Company's capital structure, reduce interest obligations and reinforce the Company's financial stability and long-term viability. "This refinancing marks a significant milestone for Auxly, resulting in a stronger, more resilient company," said Hugo Alves, CEO of Auxly. "These transactions will significantly reduce our debt, strengthen our balance sheet and give us the flexibility to invest in innovation and growth. The actions support our objective of achieving sustainable, profitable growth and creating long-term value for all of our stakeholders." Travis Wong, CFO of Auxly, added: "These transactions materially improve and simplify our capital structure. As a result of the refinancing, we anticipate the removal of the going concern uncertainty disclosure from our financial statements which is a clear reflection of our strengthened financial position and the growing stability of our operations." Amended Credit Facility The Company has entered into a non-binding agreement providing indicative terms for an amendment and restatement of Auxly Leamington's existing credit facility agreement with a syndicate of lenders led by BMO (the " Amended Credit Facility"). The key modifications to be provided under the Amended Credit Facility will include the following: Borrower: The Company will replace Auxly Leamington as the borrower. Facility Structure: Credit facility of $50.7 million consisting of: Term loan of $36.2 million Revolving facility of $10.0 million to be used for working capital and corporate requirements Existing equipment leases of $4.5 million Term: Two years with an option to extend for an additional year for $100,000. Updated Financial Covenants: Revised covenants which provide the Company with the flexibility to support its long-term growth strategy. Security: The Amended Credit Facility will be secured by all, or substantially all, of the assets of the Company and its subsidiaries (rather than primarily the assets and equity of Auxly Leamington as is the case under Auxly Leamington's existing credit facility). The Company and the lenders are working towards a definitive binding amendment and restatement agreement for the Amended Credit Facility, although there can be no assurance that a definitive amendment and restatement agreement with the lenders will be reached. Imperial Brands Convertible Debenture Settlement The Company and Imperial Brands have entered into the Exchange Agreement pursuant to which, and subject to the execution of the Amended Credit Facility on the terms provided in the Term Sheet: Imperial Brands will convert the remaining $1.0 million principal amount owed under the Debenture into 1,234,568 Shares at a conversion price of $0.81 per share in accordance with the terms of the Debenture (the " Principal Conversion"); Imperial Brands will convert approximately $1.39 million of accrued interest under the Debenture into Shares at a per-share conversion price of $0.0811, equal to the trailing 5-day volume-weighted average trading price of the Shares on the Toronto Stock Exchange (the " TSX") as of the date hereof (the " Interest Conversion"); and the Company will issue to Imperial Brands pre-funded warrants to acquire up to 90,883,618 Shares (the " Warrants") in exchange for a certain amount of additional interest, and all remaining accrued interest owed under the Debenture will be forgiven. Each Warrant will entitle an affiliate of Imperial Brands to purchase one Share for a nominal exercise price at any time prior to December 31, 2028 (the " Expiry Date"), provided that the number of Warrants exercisable for Shares (the " Underlying Shares") that may be exercised at any time prior to the Expiry Date will be limited to such number of Warrants for which the issuance of corresponding Underlying Shares would not result in Imperial Brands owning more than 19.9% of all the then outstanding Shares. Upon the completion of the Principal Conversion and the Interest Conversion (assuming such completion occurs), the Debenture will be cancelled and there will be no further amounts owing thereunder, and Imperial Brands will own and control approximately 19.9% of all issued and outstanding Shares. The execution of the Amended Credit Facility and the completion of the transactions contemplated by the Exchange Agreement are expected to occur on or about June 30, 2025, subject to the satisfaction of certain conditions precedent, including (in the case of the transactions contemplated by the Exchange Agreement) the receipt of the required approval from the TSX. ON BEHALF OF THE BOARD "Hugo Alves" CEO About Auxly Cannabis Group Inc. (TSX: XLY) Auxly is a leading Canadian consumer packaged goods company in the cannabis products market, headquartered in Toronto, Canada. Our mission is to help consumers live happier lives through quality cannabis products that they trust and love. Our vision is to be a global leader in quality cannabis products. Learn more at and stay up to date at Twitter: @AuxlyGroup; Instagram: @auxlygroup; Facebook: @auxlygroup; LinkedIn: company/auxlygroup/. Related Party Transaction Imperial Brands is considered a "related party" of the Company, and the transactions contemplated by the Exchange Agreement (collectively, the " Settlement") constitute a "related party transaction", as such terms are defined by Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions (" MI 61-101"). The completion of the Settlement is exempt from the minority shareholder approval and formal valuation requirements of MI 61-101 as, at the time of execution of the Exchange Agreement, the fair market value of the consideration to be paid pursuant to the Settlement amounted, in aggregate, to less than 25% of the market capitalization of the Company. Further details will be provided in the corresponding material change report of the Company in respect of the Settlement, a copy of which will be filed under the Company's issuer profile on SEDAR+ which is accessible at Required Early Warning Disclosure Prior to the Settlement, Imperial held 247,631,691 Shares (approximately 18.79% of the issued and outstanding Shares (calculated on a non-diluted basis)), and approximately $1 million principal amount of the Debenture. Following the Settlement (assuming it is completed), Imperial will hold 265,968,180 Shares (approximately 19.9% of the issued and outstanding Shares (calculated on a non-diluted basis)) and the Warrants, being pre-funded warrants to acquire up to 90,883,618 Shares. The aggregate consideration to be paid by Imperial for the Shares issuable upon the completion of the Principal Conversion and the Interest Conversion and the Warrants is approximately $9.8 million (which, together with the amount forgiven in the amount of approximately $11.8 milion, reflects the aggregate settlement of the indebtedness owed under the Debenture prior to the Settlement (assuming it is completed)). Imperial Brands intends to review its investment in the Company on a continuing basis and may, subject to the terms of the second amended and restated investor rights agreement between Imperial Brands and the Company dated March 28, 2024, purchase or sell Shares, either on the open market or in private transactions, or further exercise its conversion rights under the Warrants in the future, in each case, depending on a number of factors, including general market and economic conditions and other factors and conditions Imperial Brands deems appropriate. Imperial Brands may formulate other purposes, plans or proposals regarding the Company or any of its securities or may change its intention with respect to any of the foregoing. An early warning report will be filed by Imperial Brands with applicable Canadian securities regulatory authorities. To obtain a copy of the early warning report, please contact Matthew Brace at +44 (0)117 963 6636. Notice Regarding Forward Looking Information: This news release contains certain "forward-looking information" within the meaning of applicable Canadian securities law. Forward-looking information is frequently characterized by words such as "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar words, or information that certain events or conditions "may" or "will" occur. This information is only a prediction. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking information throughout this news release. Forward-looking information includes, but is not limited to: the execution of the Amended Credit Facility and the anticipated timing thereof; the anticipated benefits of the Amended Credit Facility and the timing thereof; the completion of the Settlement (and any portion thereof) and the anticipated timing thereof; the issuance of Underlying Shares in connection with the potential future exercise of Warrants; the anticipated benefits of the Settlement and the timing thereof; the Company's execution of its product development and commercialization strategy; consumer preferences; Imperial Brands' intentions to review its investment in the Company on an ongoing basis; political change; future legislative and regulatory developments involving cannabis and cannabis products; and competition and other risks affecting the Company in particular and the cannabis industry generally. A number of factors could cause actual results to differ materially from a conclusion, forecast or projection contained in the forward-looking information included in this release including, but not limited to, whether: the expected benefits of the execution of the Amended Credit Facility and/or the Settlement (or any portion thereof) materialize in the manner expected, or at all; there is acceptance and demand for current and future Company products by consumers and provincial purchasers; and general economic, financial market, legislative, regulatory, competitive and political conditions in which the Company operates will remain the same. Additional risk factors are disclosed in the annual information form of the Company for the financial year ended December 31, 2024 dated March 20, 2025 and other documents that the Company files with Canadian securities regulatory authorities from time to time. New factors emerge from time to time, and it is not possible for management to predict all of those factors or to assess in advance the impact of each such factor on the Company's business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking information. The forward-looking information in this news release is based on information currently available and what management believes are reasonable assumptions. Forward-looking information speaks only to such assumptions as of the date of this release. Readers should not place undue reliance on forward-looking information contained in this news release. The forward-looking information contained in this release is expressly qualified by the foregoing cautionary statements and is made as of the date of this release. Except as may be required by applicable securities laws, the Company does not undertake any obligation to publicly update or revise any forward-looking information to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events, whether as a result of new information, future events or results, or otherwise. SOURCE Auxly Cannabis Group Inc.
Yahoo
08-06-2025
- Business
- Yahoo
3 mistakes to avoid when investing a SIPP
A pension is a very important thing, but for much of our working lives (let alone before) we may not give it nearly as much thought as it deserves. Take a Self-Invested Personal Pension (SIPP), for example. Given its long-term nature, it can be tempting when times are busy to put off thinking about it or investing the money in it. But that can be a costly mistake once retirement rolls around. Here are three mistakes I aim to avoid when investing my own SIPP. We know from past experience that the economy will keep evolving. Some shares that are barely known and perhaps even trade for pennies today could turn out to be worth a fortune a decade or two from now. Sometimes, that fear of missing out leads people to rush into shares they do not understand in case they shoot up in value before they have seized the opportunity. That is not the sort of prudent, considered investment I want for my SIPP; it is speculation. I try to avoid the mistake of investing in the 'next big thing' unless I understand it. Of course, one's circle of competence is not static – it is possible to learn about an emerging industry that may sound promising, like renewable energy or biotech. Does this sound like a problem to you? Warren Buffett invested tens of billions of dollars in Apple stock. It did so well that not only did the stock soar in value by tens of billions of dollars, it came to represent by far the largest part of Buffett's company Berkshire Hathaway's portfolio of listed shares. It may not sound like a problem. As billionaire Buffett is still working at 94, his pension may not be a big concern to him. But Buffett knows what every SIPP investor ought to remember: you can have too much of a good thing. The tech giant remains Berkshire's largest shareholding, but share sales mean it no longer dominates the portfolio to the same extent. Many investors like the idea of buying dividend shares that can tick over quietly in their SIPP, compounding income for decades. I am one of them. But it is always important not just to look at the current dividend yield of a share. One must consider the prospective future yield, based on potential future free cash flows. Take Imperial Brands (LSE: IMB) as an example. Like many tobacco companies, it is a free cash flow machine. In the first half of this year alone, it generated operating cash flows of £1.5bn. Now, it saw £0.2bn of investing-related cash outflows. It also saw £0.3bn of finance-related cash outflows. But it paid over £1bn of dividends, most of it to shareholders. If it had not chosen to spend £0.6bn on buying back its own shares, Imperial's cash flows would comfortably have covered dividends and left money to spare. So far, so good. Longer term, though, cigarette use is declining. Tobacco volumes fell 3% year on year. The firm has pricing power but in the long term I fear free cash flows could fall and lead to a dividend cut. I once owned Imperial Brands shares in my SIPP – but no more. The post 3 mistakes to avoid when investing a SIPP appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool C Ruane has no position in any of the shares mentioned. The Motley Fool UK has recommended Apple and Imperial Brands Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025
Yahoo
08-06-2025
- Business
- Yahoo
Want to turn a £20k ISA into a £1k second income overnight? Here's how
With so many dividend-paying companies to choose from, it's not difficult for UK investors to generate a second income in the stock market. And those fortunate enough to have £20,000 sat in their Stocks and Shares ISA can immediately start earning an extra £1,000 a year just by investing in 5%-yielding shares. And looking across the FTSE 350, there are quite a few businesses offering such potential. As of June, there are 66 stocks within the FTSE 350 offering a 5% or more level of payout. And this list includes some fairly big names such as HSBC at 5.5%, Aviva at 5.9%, and Imperial Brands (LSE:IMB) at 6.7%. Snapping up £20,000 worth of shares in any of these stocks would instantly start generating even more than £1,300 in passive income. However, just because a stock offers an attractive yield, that doesn't mean it's a guaranteed winning investment. Don't forget dividends can be cut at any time if the underlying business doesn't generate enough cash flow. As such, some due diligence is crucial before jumping in. With that in mind, let's zoom in on the highest-yielding enterprise on this list – Imperial Brands. High yields and tobacco companies aren't a new phenomenon. ESG investors actively avoid buying shares in these types of businesses, while many others are put off by the increasingly hostile regulatory landscape. As such, Imperial Brands, along with other companies like British American Tobacco, have long offered impressive levels of payouts for their shareholders. What's more, both businesses have long track records of steadily hiking their dividends over time. So far, that sounds fairly advantageous for those seeking a second income. Even more so, given management has recently reiterated its targets of growing its free cash flow to as high as £3bn to fund future dividends and share buybacks. However, while that certainly sounds encouraging, hitting this milestone is far from guaranteed. The firm's latest interim results were fairly lukewarm, with sales falling by 3.1% and operating profits sliding by 2.5%. While these figures were in line with market expectations, the announcement that CEO Stefan Bomhard is stepping down later this year came as a surprise to many. Despite only being in the role for five years, Bomhard's retiring and will be moving out of the corner office in October. Under his leadership, the company emerged from the pandemic and more than doubled its market cap. And although he's selected the current CFO Lukas Paravicini to succeed him, he has some pretty big shoes to fill. Undergoing a leadership transition while navigating through a tough regulatory environment and an ongoing rollout of new non-tobacco products is no easy feat. This risk's undoubtedly a big reason why the shares are down almost 10% since the announcement. So is this a stock worth considering for generating a second income right now? That all depends on personal risk tolerance. If Paravicini can continue to execute Bomhard's strategy successfully, then a lucrative income stream seems likely. But if he can't, the recent dip might be the start of another protracted decline in Imperial Brand's share price. Investors will have to mull over the possibilities to determine if the risk's worth the potential reward. The post Want to turn a £20k ISA into a £1k second income overnight? Here's how appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool Zaven Boyrazian has no position in any of the shares mentioned. The Motley Fool UK has recommended Imperial Brands Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025 Sign in to access your portfolio
