The Korean tobacco company KT&G and the governor of Kaluga region, Anatoly Artemov, have signed a note of understanding outlining their co-operation with regard to the construction of a cigarette making plant.

According to a Rustabak.ru report, KT&G is in talks with the government of Kaluga region, some 150 km south of Moscow, to build a new cigarette making plant. The Korean tobacco group has recently announced a USD 166 million investment plan for building a tobacco factory in central Russia. The plant with a projected capacity of 6 billion cigarettes per year is expected to launch operations in 2010 and will be employing local labour only.
KT&G has been active on the Russian market since 1999 with a share of 0.7 per cent. Its local brand portfolio includes the popular brand Esse. Over the past few months the company has been reportedly negotiating an acquisition deal with Donskoy Tabak, Russia’s largest independent cigarette producer. However, no decision has been made and the KT&G is now in search of a suitable site for construction of its own facility. (vt)