Gallaher's hopes for Romanian cigarette production

British cigarette producer Gallaher, ranked sixth internationally and with sales worth L9 billion last year, is entering the Romanian market. It is set to start production at a location in Bucharest.

“We will soon kick-start the production process in Romania, but all I can tell you at this moment is that we will produce in Bucharest,” Dan Crisan, general manager of the company’s branch in Romania, Gallaher Austria Tabak, told Ziarul Financiar.

He was unwilling to specify, however, whether production would be launched within a plant the company would build from scratch or within one of the existing plants held by the other producers with facilities in Bucharest.

Gallaher Romania has initiated a massive personnel recruiting campaign, launching advertisements for the positions of operational manager, sales manager and supervisors.

The cigarette producers owning plants in Bucharest are Japan Tobacco International (JTI), Philip Morris (owning two plants, one of which previously belonged to Papastratos), and Societatea Nationala Tutunul Romanesc SA (Romanian National Tobacco Company – SNTR).

Crisan did not reveal what kind of investment the company had earmarked for initiating production, or what cigarette brands would be produced in Romania.

Sources within the tobacco industry recall that Gallaher was previously present on the Romanian market for a short period, with the Ronson cigarette brand. Production took place for several months at the Bucharest-based Papastratos plant, before the Greek producer was bought by Philip Morris. The only locations in Bucharest where Gallaher could manufacture cigarettes are the SNTR plant or Papastratos plant.

“Cigarettes for one of the multinationals could be processed within SNTR’s production capacities. Gallaher officials repeatedly asked us to arrange a meeting to discuss the possibility of producing cigarettes for this multinational using SNTR production facilities, but nothing happened,” says Ioan Niculae, one of the national cigarette producer’s shareholders. He says that SNTR has not sold any of its plants so far and that there have been talks linked to the manufacture of cigarettes using SNTR production facilities before, but to no avail.

Several years ago, SNTR’s Iasi-based plant produced BioFilter cigarettes for the Greek company Sekap. At the same time, Gallaher attempted to start production in a Timisoara-based plant, but no agreement was reached. “We will not comment on our competitors’ actions,” says Peter Imre, Corporate Affairs Director for Philip Morris Romania.
stelian.negrea@zf.ro