PMI Buying A Third of Colombian Market

Source from:  Tobacco Reporter 07/14/2009

Philip Morris International has agreed to buy all of the shares of the privately owned Colombian cigarette manufacturer, Productora Tabacalera de Colombia (Protabaco), for $452 million. Protabaco is the second largest tobacco company in Colombia, with, last year, estimated volume sales of 6.1 billion cigarettes and a market share of 31.8 per cent. The company reported net revenues of about $107.6 million in 2008. Its leading brands include Mustang, Premier and President. "We are extremely pleased to reach this agreement with Protabaco in order to continue to build our business in this important and strategic market," said Miroslaw Zielinski, president of PMI's Latin America and Canada Region. "This strategically compelling transaction will provide PMI with an excellent opportunity to further develop Protabaco's strong brand portfolio and reflects the continuing confidence we have in the future of Colombia, its economy and the tobacco industry." "In 2005, PMI acquired Compañía Colombiana de Tabaco S.A. (Coltabaco)," PMI said in a press note. "Since then, PMI has continued to invest in Coltabaco, its employees and its infrastructure, as well as in social and economic programs in Colombia, including investments in the tobacco growing sector." "This is an excellent development for Protabaco and our employees," said Jaime Delgado, general manager of Protabaco. "PMI is well known as a successful manufacturer and marketer of quality tobacco products and we believe they are in an excellent position to continue to develop our strong brands and strong organization." The transaction, which is subject to competition authority approval and final confirmatory due diligence, is projected to be immediately marginally accretive to PMI's earnings per share, and is expected to close within the next six months. Enditem