News Release

MIAMI, FL, June 27, 2006 -- Vector Group Ltd. (NYSE: VGR) announced today that it intends to offer $85 million of senior convertible debentures due 2026 (the “Debentures”) in a private placement, subject to market and other conditions.

The Debentures will be convertible into Vector common stock, at the option of the holder, at a price to be determined. The initial purchaser will have an option to purchase an additional amount of Debentures.
The Company intends to use the net proceeds of the offering to call the remaining $63.1 million principal amount of its 6.25% Convertible Subordinated Notes due July 15, 2008 and for general corporate purposes.
This press release does not constitute an offer to sell or a solicitation of an offer to buy the Debentures. The Debentures and the common stock issuable upon conversion thereof have not been registered under the Securities Act of 1933, as amended, or any state securities laws. Unless so registered, the Debentures and the common stock issuable upon conversion of the Debentures may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act of 1933, as amended, and applicable state securities laws.

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Company has tried, whenever possible, to identify these forward-looking statements using words such as "anticipates", "believes", "estimates", "expects", "plans", "intends" and similar expressions. These statements reflect the Company's current beliefs and are based upon information currently available to it. Accordingly, such forward-looking statements involve known and unknown risks, uncertainties and other factors which could cause the Company's actual results, performance or achievements to differ materially from those expressed in, or implied by, such statements.

Vector Group is a holding company that indirectly owns Liggett Group Inc., Vector Tobacco Inc. and New Valley LLC. Additional information concerning the company is available on the company’s website, www.VectorGroupLtd.com.