- Global hookah leader AIR Global going public via merger with Cantor Equity Partners III, Inc. (Nasdaq: CAEP)
- AIR expected to trade on Nasdaq under ticker symbol “AIIR” upon close
- AIR’s 2025 revenue rose 6% to $400 million while Ebitda rose 7% to $139M
- Operates under Al Fakher brand, distributed across North America, Europe, the Middle East and Asia
- Hooked up with Snoop Dogg to launch co-branded premium hookah flavors in the U.S. and Germany
- Market growth supported by rising popularity and friendlier regulations versus other tobacco products
- AIR has a large library of patents, with most around OOKA, a charcoal free, electrically heated hookah that offers a cleaner inhalation method designed to reduce harmful compounds
- AIR brings strong leadership with experience at British American Tobacco P.L.C., including CEO Stuart Brazier, CFO Bassem Lotfy and Chief Regulatory & Legal Officer Ronan Barry
- Strong M&A track record including German e-commerce platforms Emtrada GmbH and Finis Direct GmbH in 2024, expanding its direct-to-consumer capabilities
- AIR trades at 13 times 2025 Ebitda, below the 17 times commanded by both Philip Morris International Inc. and Turning Point Brands, Inc.
When it comes to tobacco, fast-changing consumer tastes and regulations can be disorienting for investors. But when the smoke clears, there is a growth category that stands apart from the rest: hookah.
It’s time to get acquainted with AIR Global, the world’s leader hookah and shisha for consumption both on premise and at home. AIR is going pubic via a merger with merger with Cantor Equity Partners III, Inc. (Nasdaq: CAEP) and is expected to trade under the AIIR ticker after the close. Investors who buy shares now would see them automatically convert to AIIR once the deal closes in the second quarter.
It may help uninitiated investors should get a flavor for the hookah experience. Rather than merely nicotine delivery, hookah has roots in a communal bonding experience going back to Persia and India hundreds of years ago.
The hookah is powered by tobacco molasses, which isn’t burned but heated up. Afficionados often enjoy hookah in large groups paired with food, drink, conversation and even belly dancing.
“The hookah lounges in Dubai are the best in the world,” CEO Stuart Brazier, himself based in Dubai, said in a recent interview. “It’s a fantastic experience.”
The flavored hookah category continues to grow globally, and the expansion is even faster among western consumers, which translates to enormous sales potential. AIRO’s western-market sales have grown at a healthy clip over the last several years, accounting for 32% of groups sales in 2024 versus 21% in 2019.
In addition to marketplace tailwinds, AIR has forged smart partnerships to help raise awareness of the brand. In the U.S. and Germany, AIR hooked up with Snoop Dogg to launch co-branded premium hookah flavors. It also has a collaboration with the widely-known Cookies brand that has a strong following, especially in the U.S.
The company’s senior management members include multiple seasoned executives from global heavyweight British American Tobacco P.L.C. who can help guide the company’s expansion through various jurisdictions They include Mr. Brazier, CFO Bassem Lotfy and, importantly, Chief Regulatory & Legal Officer Ronan Barry.
Mr. Barry’s role is key in an industry like tobacco, which requires close coordination with regulators. In general, Hookah products also have a friendlier regulatory framework than most tobacco products.
Indeed, all AIR tobacco products sold in the U.S. have obtained required Marketing Authorization from the FDA, including Premarket Tobacco Product Applications (PMTA) or Substantial Equivalence orders, demonstrating regulatory sophistication. What’s more, since the start of 2023, AIR has received no FDA warning letters, untitled letters, or enforcement actions, and maintains no recalls or product safety issues – a critical differentiator in the heavily regulated tobacco sector.
It’s also notable that even avid hookah fans aren’t consuming it several times a day as is often the case with other formats. Instead, someone who enjoys hookah might enjoy it a couple of times a week. The process of setting up a hookah is also somewhat complex and very different from toking a disposable vape or packing a nicotine pouch.
AIR continues to roll out new products to drive organic growth. One key initiative is OOKA, launched in 2023 and reflecting AIR’s strategic move into the premium, convenience-focused segment. OOK targets multi-various settings from homes to restaurants and cafes and consumers in the UAE, Germany, and the U.S., with plans for further geographic expansion.
The OOKA economics are impressive. Compared with core products, OOKA drives 20x the revenue and 15x the gross profit. It’s also made of components that have lower health risk than leading “heat not burn” products on the market, AIR says.
The company also continues to innovate in markets where hookah is already widely known. Take Saudi Arabia, where locals don’t drink alcohol but shisha experiences are popular. AIR has introduced Al Aseel, its first shisha offering for the value-minded consumer in Saudi Arabia.
There’s also plenty of scope to grow via acquisition, which should become easier when the company has listed stock in addition to cash as a currency. AIR has successfully integrated multiple acquisitions, including achieving 100% ownership of German e-commerce platforms Emtrada GmbH and Finis Direct GmbH in 2024, expanding its direct-to-consumer capabilities.
Turning to financials, the company is growing on both the top and bottom line. AIR’s 2025 revenue rose 6% to $400 million while Ebitda rose 7% to $139 million.
Investors should be smart about benchmarking AIR versus peers. Many tobacco majors are still dominated by cigarette sales, which have been in decline and likely will continue as such. The best two comparables are likely those with high-growth smokeless products: Philip Morris International Inc., which owns the hugely popular Zyn pouch business via its acquisition of Swedish Match along with Turning Point Brands, Inc., owner of Stoker’s brand (moist snuff, chewing tobacco) and nicotine pouches (FRE).
AIR trades at 13 times 2025 Ebitda, below the 17 times commanded by both Philip Morris International and Turning Point. That’s an attractive discount given AIR’s dominance in a unique category will few serious competitors.
Investors have already lit up shares of Philip Morris International and Turning Point, but neither has a differentiated niche like AIR. Those who instead try a taste of AIR should enjoy delicious rewards.
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