Philip Morris to acquire Columbian cigarette maker for $452 million

Continuing its acquisition spree, tobacco giant Philip Morris International Inc that owns the Marlboro brand, has entered into an agreement to purchase 100-per cent stake in Columbian cigarette producer Productora Tabacalera de Colombia, Protabaco Ltd. (Protabaco), for $452 million, expanding its presence in the South American continent.

Privately-owned Protabaco is the second largest tobacco company in Columbia with about 32-per cent market share and registered a turnover of around $108 million in 2008. The company has three cigarette plants in Columbia and its leading brands are Mustang, Premier and President.

Philip Morris's president of Latin American and Canada region Miroslaw Zielinski said in a press release, ''We are extremely pleased to reach this agreement with Protabaco in order to continue to build our business in this important and strategic market.''

He further added: ''This strategically compelling transaction will provide Philip Morris 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.''

Last week, the company announced its intention to buy the Swedish Match South Africa Pty. Ltd, the South African affiliate of Swedish Match AB, a market leader in pipe tobacco and snuff categories, for $222 million. Philip Morris and Swedish Match are already joint venture partners for producing smokeless tobacco.

Philip Morris had acquired several tobacco companies worldwide in the past few years. It acquired Coltabaco, another major Columbian cigarette manufacturer in 2005 for $300 million.