Jump to full article: Reuters, 2008-02-22
Author: Selcuk Gokoluk and David Jones
Intro: British American Tobacco, the world's second largest cigarette group, won the auction for Turkish state-owned tobacco firm Tekel on Friday after beating off three Turkish rivals with the highest bid of $1.72 billion.
London-based BAT will now grab the No 2 spot in the world's eighth largest tobacco market as Ankara finally sold an asset it has been trying to privatise for about five years, but the deal raised concerns over job losses and factory closures.
The deal comes just weeks after Turkey's parliament approved a law banning smoking in public places over the next 15 months which BAT estimates will cut smoking levels by 5 percent in a market where Turks smoke around 110 billion cigarettes a year.
BAT, which makes brands such as Kent, Pall Mall, Dunhill and Lucky Strike cigarettes, said the deal would lead to cost savings, enhance earnings and transform its Turkish business which has been loss-making since it entered the market in 2002.
"This deal transforms our business in a market which we think is important for us," BAT Chief Executive Paul Adams told a conference call after announcing the deal. . . .
Unionised workers said on Friday they were occupying Tekel buildings and would not leave, in protest against the sale
Jump to full article » |