JT Acquiring Brazilian Leaf Supplier

Source from:  Tobacco Reporter 07/23/2009

The Japan Tobacco Group is to acquire another leaf tobacco supplier as part of its effort to ensure the sustainable growth of its business. Japan Tobacco Inc said today it had agreed to acquire all of the outstanding shares in Kannenberg & Cia Ltda (Kannenberg) and Kannenberg, Barker, Hail & Cotton Tabacos Ltda (KBH&C). The acquisition was subject to 'required procedures' but was expected to be completed by October, it added in a note that was posted on Japan Tobacco International's website. KBH&C processes and sells Brazilian tobaccos, sourced principally from Kannenberg, a leaf producer of flue-cured and Burley tobaccos that has operated in Brazil for more than 60 years. Because of its concerns about high leaf costs and supply source volatility, JT announced the acquisition of Tribac and the establishment of JTI Leaf Services (US) LLC on June 12, moves aimed at improving the stability and capability of, respectively, its African and US leaf tobacco procurement. The acquisition of Kannenberg and KBH&C was intended to globalize the scope of the JT Group's procurement capability by adding Brazil, which was second only to China in tobacco leaf production worldwide, the note said. With the exception of Japanese leaf, all leaf procurement for the JT Group will be made through its Global Leaf Procurement Group based in Geneva, into which the Kannenberg and KBH&C's organizations will be integrated. Enditem