Japan Tobacco buys Philippine cigarette maker for close to $1 billion

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Just  shortly after Philippine President Rodrigo Duterte imposed a nationwide law that prohibits smoking in public, Japan Tobacco,  the world’s fourth-largest tobacco manufacturer, thought it would be a good opportunity to buy Philippines Mighty Corp, the second largest cigarette firm in terms of market share in the Philippines, known for sub-premium brands such as Mighty, King, Chelsea and Marvels.

Japan Tobacco said on August 22 it would buy Mighty for about $936 million, its second large deal in Southeast Asia this month as it deepens its push into emerging markets, among which the Philippines were a major driver for international revenue growth, the Japanese firm said – despite the ban.

Earlier this month, Japan Tobacco bought Indonesia’s Karyadibya Mahardhika, a kretek cigarette maker, and its distributor Surya Mustika Nusantara for an enterprise value of $1 billion. Both deals rank among the Japanese company’s  largest outbound acquisitions.

In the Philippines, the acquisition is meant to help Japan Tobacco, which sells the Winston, Mevius and Camel brands in the Philippines, challenge the Philippine market leader, PMFTC Inc., a venture owned by Philip Morris International and Fortune Tobacco Corp.

The deal will help Mighty Corp settle unpaid taxes in the Philippines. The company was charged with avoiding 37.88 billion pesos {$690 million) in taxes and offered by the Philippines’ Department of Finance to pay a large part of them with funds from the sale.

The Philippine finance ministry has described the agreement as the country’s biggest-ever tax settlement.

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Reading Time: 1 minute

Just  shortly after Philippine President Rodrigo Duterte imposed a nationwide law that prohibits smoking in public, Japan Tobacco,  the world’s fourth-largest tobacco manufacturer, thought it would be a good opportunity to buy Philippines Mighty Corp, the second largest cigarette firm in terms of market share in the Philippines, known for sub-premium brands such as Mighty, King, Chelsea and Marvels.

Reading Time: 1 minute

Just  shortly after Philippine President Rodrigo Duterte imposed a nationwide law that prohibits smoking in public, Japan Tobacco,  the world’s fourth-largest tobacco manufacturer, thought it would be a good opportunity to buy Philippines Mighty Corp, the second largest cigarette firm in terms of market share in the Philippines, known for sub-premium brands such as Mighty, King, Chelsea and Marvels.

Japan Tobacco said on August 22 it would buy Mighty for about $936 million, its second large deal in Southeast Asia this month as it deepens its push into emerging markets, among which the Philippines were a major driver for international revenue growth, the Japanese firm said – despite the ban.

Earlier this month, Japan Tobacco bought Indonesia’s Karyadibya Mahardhika, a kretek cigarette maker, and its distributor Surya Mustika Nusantara for an enterprise value of $1 billion. Both deals rank among the Japanese company’s  largest outbound acquisitions.

In the Philippines, the acquisition is meant to help Japan Tobacco, which sells the Winston, Mevius and Camel brands in the Philippines, challenge the Philippine market leader, PMFTC Inc., a venture owned by Philip Morris International and Fortune Tobacco Corp.

The deal will help Mighty Corp settle unpaid taxes in the Philippines. The company was charged with avoiding 37.88 billion pesos {$690 million) in taxes and offered by the Philippines’ Department of Finance to pay a large part of them with funds from the sale.

The Philippine finance ministry has described the agreement as the country’s biggest-ever tax settlement.

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