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Unact Quits Smoking
The Unact Co. has severed its contract for the sale of JTI cigarettes, which was purchased by the Megapolis Co. Now Megapolis has control over the distribution of JTI brands in Moscow Region, which accounts for 30 percent of its sales. Unact has complete left the tobacco market and will distribute candy and baked goods. It is the distributor of Kraft Foods, Nestle, Bridgetown and other products.
Megapolis is the exclusive distributor of Philip Morris, Gallaher Liggett-Ducat, Imperial Tobacco and Altadis. Its turn over in 2006 was $2.5 billion on 120 billion cigarettes. It also distributes beer and snacks. It is part of the Mercury Co.
In September, Megapolis began its consolidation of JTI brands when it bought the contracts of Business Tobacco (distributor of JTI in Moscow and southern Central Russia), Everest (Stavropol Territory), Berlei (Krasnodar Territory) and Stimul (the Russian Far East). Now it has control over the distribution of JTI-Gallaher (the companies announced their merger in the spring of this year) in the key central regions of the country, which account for 25 percent of sales in volume and 30 percent in income (about $1 billion).
Megapolis can expect to increase its receipts by about $300 million thanks to the contract it took over from Unact. Last year, cigarettes accounted for $250 million of Unact's $460-million receipts. Unact is now in negotiations with FMCG-Sector over new distribution.
www.kommersant.com
All the Article in Russian as of Dec. 06, 2007
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