Source: akolosov.art
According to a report by Egypt Daily News, Philip Morris International will begin producing products for the Egyptian market through its subsidiary, Orient Company, which is part of its joint venture tobacco company, United Tobacco Company (UTC).
Currently, the licensed entity Oriental Company will continue producing Philip Morris' cigarette products until their production inventory is depleted.
Philip Morris expressed pride in its strategic partnership with the state-owned tobacco company that has lasted almost half a century and looks forward to maintaining this partnership through Eastern Co.'s holdings in UTC. According to Enterprise Press, in May, the Egyptian Parliament approved Eastern Co.'s plan to purchase a 25% stake in UTC for 100 million Egyptian pounds ($5.2 million).
The Chairman and CEO of Eastern Co., Hani Aman, announced that his company will be represented by two members of the UTC board of directors.
The acquisition is part of a deal between a Philip Morris subsidiary and an East Asian company to produce cigarettes locally. UTC was the only company to bid last year after other companies complained that the bidding terms would establish a monopoly in the local market.
Philip Morris has confirmed its commitment to all existing contractual agreements with traders and suppliers to ensure the supply of its products across all provinces in Egypt. The company has stated that it will continue to offer all its products at the same price as recently set by official authorities and will not be changing packaging.
Oman has stated that Eastern Company is currently attempting to absorb the increased production costs resulting from recent rises in raw material expenses internally.
He pointed out that apart from the impact of rising US dollar prices on other products, supply chain disruptions also directly affect the rise of some production inputs.
The tobacco business report of Dongfang Company stated that its revenue for the first nine months of the 2021-2022 fiscal year was EGP 12.78 billion, which is a 5% increase from the same period last year.
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