Tobacco.org

INTERVIEW-JT set for foreign factory consolidation 

JT's chief executive officer Masaru Mizuno told Reuters in an interview that the $7.83 billion takeover of the non-U.S. tobacco operations of RJR, known for its Camel and Winston brands, would result in synergies generating an estimated $300 million a year in profits after five years' time. Mizuno said the use of an established sales network at RJR International, especially in Europe, combined with JT's strength in East Asia, should create synergy benefits in sales, while joint purchases of foreign tobacco leaf would help reduce costs.

``By adding these synergies from the takeover, I believe the impact will surpass the takeover cost,'' he said.

Under the takeover, JT obtained 22 RJR International factories operating in 18 countries, including main plants in Germany, Russia and Turkey. This comes on the top of JT's own overseas factories, such as one in Manchester, Britain.

``We would like to make decisions on how to unify operations of RJR International and JT's international division by the end of this year. This involves how we should locate and consolidate overseas factories,'' Mizuno said.

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