Philip Morris International (PMI) took a 20 per cent stake in Megapolis Distribution of Russia for USD 750 million (EUR 553 million) to support expansion, the company said.

Megapolis Distribution is the holding company of CJSC TK Megapolis, which distributes PMI products in Russia. “We are delighted to reach this agreement with Megapolis, our proven distribution partner, which will support our business expansion in this profitable market,” said Miroslaw Zielinski, the PMI president responsible for Eastern Europe. In addition to the price, as much as USD 100 million in incentive payments could be made based on Megapolis performance in the next four years, PMI said.
With an industry volume of 370 billion sticks in 2012, Russia is the largest cigarette market outside of China. PMI’s year-to-date market share as of September was 26.1 per cent, PMI said. Russia brands include Marlboro, Parliament, L&M, Chesterfield, Bond Street and local trademarks Optima and Apollo-Soyuz.