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CHINA: Joint venture construction plans for proposed $1,500,000,000 cigarette factory, BRITISH AMERICAN TOBACCO (BAT) [UK] & CHINA EASTERN INVESTMENT CO. LTD. [China] Order #: 080704.

Article Excerpt
PROJECT OVERVIEW:

The WORLD HEALTH ORGANIZATION (WHO) has indicated that there are over 320 million smokers in China, and another 3 million join them every year. Of these, more that 69% of men over the age of 15 smoke. The market, for that matter, has an estimated sales value of about $9,000,000,000 per year.

As a result, a Sino/UK joint venture was recently established in view of building a new cigarette factory in the country. The partners in the planned undertaking include UK-based BRITISH AMERICAN TOBACCO (BAT) and the local CHINA EASTERN INVESTMENT CO. LTD. The move marks BAT's return to China after an exile of over 50 years triggered by the Communist revolution in 1949.

As things currently stand, the consortium has received government approval to proceed ahead with the project. Construction plans under consideration call for building a plant with an installed production capacity of 1 billion cigarettes per year or about 5% of the Chinese market. Product output will consist of BAT's State Express 555 and Kent as well as other brands.

The cost to build the new complex, at a site still to be determined, has been pegged at $1,500,000,000. BAT employs a total staff of about 85,800. The company is acknowledged to be the world's most diversified tobacco group with manufacturing and marketing operations in some 180 countries and a global market share estimated to top 15%. The group markets a wide range of international brand names like Lucky Strike, Benson & Hedges, Kent, Rothmans and Pall Mall. COPYRIGHT (Cr) World Wide Projects (WWP) 2004 The data contained in this report may not be reproduced, redistributed and/or put into...