Philip Morris snaps up minority stake in Eastern Company: US-based tobacco giant Philip Morris International has acquired an indirect 14.7% stake in state-owned cigarette maker Eastern Company, it said in a statement. Philip Morris bought the stake from new shareholder Emirati Global Investment Holding (GIH), Eastern CEO Hany Aman told Asharq Business. GIH sold 49% of its stake in the tobacco company, he added.

What’s next? The acquisition will pave the way for the two companies to explore “long-term collaboration” in manufacturing, technology, and innovation — including heated tobacco products that aim to replace cigarettes — the statement reads.

We had an idea this was coming: Phillip Morris was reported to be eyeing a minority stake in Eastern Company back in August — at the time it was said that Philip Morris will acquire the stake through its Egyptian subsidiary United Tobacco. United and Eastern are the only companies licensed to manufacture cigarettes in Egypt.

Eastern and United are already intertwined: Eastern Company agreed to purchase a 24% stake in United Tobacco for EGP 100 mn in May 2022, a month after it struck an agreement to allow the Philip Morris subsidiary to locally manufacture cigarettes.

Who owns what: Prior to the acquisition, the two biggest shareholders in Eastern were GIH and Chemical Industries Holding Company. GIH and an affiliate company owned a combined 33.29% stake in Eastern, while the state held a 20.95% share through its Chemical Industries Holding Company, according to an EGX disclosure (pdf).

Remember: GIH in November completed the purchase of a 30% stake in Eastern in a USD 625 mn transaction, becoming its single-largest shareholder.

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