LONDON (Reuters) – Philip Morris’ $16 billion offer for Stockholm-based Swedish Match represents a “healthy premium” and the Marlboro maker could yet go higher, Swedish Match’s No. 10 shareholder GACMO Investors said on Thursday.

Marlboro maker Philip Morris agreed on Wednesday to buy Swedish Match, one of the world’s biggest makers of oral nicotine products. These include Snus – a sucked tobacco product the firm says is less harmful than smoking – as well as Zyn nicotine pouches, which are used the same way and tobacco-free.

Kevin Dreyer, co-chief investment officer, value, at GAMCO identified Japan Tobacco Inc (JTI) as a possible rival bidder but said it would be hard-pressed to hijack the deal. GAMCO, formerly known as Gabelli Asset Management Company, owns just over 2% of Swedish Match, according to Refinitiv.

“PMI has very deep pockets and will be a tough company to out-bid,” he said. “This deal is really the culmination of the last five-to-seven years of work Swedish Match has done in developing Zyn into the leading brand, and having that advantageous market share – it’s an attractive stock.”

Philip Morris declined to comment. Swedish Match and JTI did not immediately respond to a request for comment.

Philip Morris needs at least 90% of shareholders to approve the deal for it to succeed. Some other shareholders have questioned whether the Philip Morris offer represents good value. Swedish Match shareholder Bronte Capital said on Wednesday the price Philip Morris agreed to pay was “unacceptable”.

(Reporting by Richa Naidu; editing by David Evans and Emelia Sithole-Matarise)