NEW YORK--(BUSINESS WIRE)--Dec. 4, 2013--
Regulatory News:
Philip Morris International Inc. (NYSE / Euronext Paris: PM) (“PMI”)
announces today its agreement to acquire a 20% equity interest in
Megapolis Distribution BV, the holding company of CJSC TK Megapolis
(“Megapolis”), PMI’s distributor in Russia. The purchase price of $750
million excludes an additional payment of up to $100 million which is
contingent on Megapolis’s operational performance over the four fiscal
years following the closing of the purchase. PMI expects the transaction
to be completed by the end of 2013 without requiring regulatory
approvals. The transaction is projected to be accretive to PMI’s
earnings per share as of the first quarter of 2014.
“We are delighted to reach this agreement with Megapolis, our proven
distribution partner, which will support our business expansion in this
profitable market,” said Miroslaw Zielinski, PMI’s President, Eastern
Europe, Middle East & Africa Region and PMI Duty Free. “In addition to
enhanced earnings and cash flow for PMI, this investment paves the way
for infrastructure expansion and improved operating efficiencies in the
strategic area of distribution in Russia, and will therefore benefit our
wide portfolio of leading brands.”
Megapolis is one of Russia’s leading consumer goods distributors
focusing principally on tobacco and beverages. It employs almost 15,000
employees and commands a direct store delivery system that reaches more
than 150,000 points of sale. Megapolis handles approximately 70% of the
cigarettes sold in Russia through its distribution agreements with PMI,
Japan Tobacco International and Imperial Tobacco Group.
This announcement is made concurrently with that of Japan Tobacco
International regarding its agreement to also acquire a 20% equity
interest in Megapolis Distribution BV.
Philip Morris International in Russia
At an industry size of 370 billion units in 2012, Russia is the largest
cigarette market outside of the People’s Republic of China. PMI’s 2013
September year-to-date market share, as measured by Nielsen, was 26.1%,
driven by its portfolio of international trademarks, including Marlboro,
Parliament, L&M, Chesterfield and Bond Street,
and local trademarks, such as Optima and Apollo-Soyuz.
Most PMI cigarettes sold in Russia are produced at the company’s
state-of-the-art facilities in Krasnodar and near St. Petersburg, which
is the second-largest PMI production facility in the world. PMI has more
than 4,500 employees in Russia.
Philip Morris International Inc.
Philip Morris International Inc. (PMI) is the leading international
tobacco company, with seven of the world’s top 15 international brands,
including Marlboro, the number one cigarette brand worldwide.
PMI’s products are sold in more than 180 markets. In 2012, the company
held an estimated 16.3% share of the total international cigarette
market outside of the U.S., or 28.8% excluding the People’s Republic of
China and the U.S. For more information, see www.pmi.com.
Source: Philip Morris International Inc.
Philip Morris International Inc.
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