Philip Morris International has acquired a 20% stake in Megapolis Distribution BV to enhance its distribution capabilities in Russia, positioning itself favorably in the evolving tobacco market.

Target Information

Philip Morris International (PMI) is represented in Russia by two affiliated companies: AO "Philip Morris Izora" in the Leningrad region and AO "Philip Morris Kuban" in Krasnodar. Additionally, it operates through LLC "Philip Morris Sales and Marketing", which has branches in approximately 100 cities across the country. Overall, PMI employs around 3,200 highly skilled professionals in Russia, holding a 30.1% market share of PMI brands as of 2019. The company is one of the largest taxpayers in the country and has invested over $2 billion in Russia to date, signaling a strong commitment to the economic potential of the region.

In recent years, PMI has undertaken a substantial long-term investment program, including over 14 billion rubles dedicated to localizing the production of innovative IQOS tobacco sticks at its Leningrad facility since 2017. The company prides itself on maintaining high quality standards, with production regularly undergoing quality control assessments based on more than 250 parameters, thereby ensuring that cigarettes produced in Russia meet the highest international standards.

Industry Overview in Russia

The tobacco industry in Russia has undergone significant transformations over the years, particularly with shifting consumer preferences towards less harmful alternatives. PMI is at the forefront of this evolution, focusing on the developm