Tobacco.org

Deconstructing a conglomerate 

Last week's sale of Sans Souci Hotel by Carreras Group represents a major but not the final stage in the de-conglomeration of the cigarette-led group that once spanned tobacco and coffee farming, financial services, printing, agro-processing, manufacturing, retailing and funds management. That final stage will come before year-end when the Carreras Group will totally cease cigarette manufacturing in Jamaica, having already transferred the bulk of that operation to Trinidad and Tobago.

By year-end therefore, the once revered conglomerate will become a distributor of cigarettes in Jamaica, and a manager of the billions of dollars in cash it now holds mainly in government paper.

"We (Carreras) are almost there," says managing director Michael Bernard, without any apparent sense of regret. "By the end of November we will have transformed the company into a distribution and marketing company."

Michael Bernard. by the end of November we will have transformed Carreras into a distribution and marketing company . . .

Trinidad and Tobago, emerged the favourite location around which British America Tobacco (BAT) - Carreras' parent-decided a decided a decade ago to consolidate its regional operation, because of its geography, and technology.

It was therefore no surprise when earlier this year, Carreras announced that it would, on a phased basis, altogether discontinue cigarette manufacture in Jamaica, and would transfer that side of its business to T&T where BAT had already consolidated its regional production, and where the cigarettes would benefit from economies of scale, and modern production facilities.

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