Beijing - Japan Tobacco, the world's third largest cigarette maker, has sold its stake in its joint venture in eastern China, state press reported Friday
Xiamen Huamei Cigarette is now wholly-owned by its Chinese shareholder, Xiamen Cigarette Factory, after it paid 150 million yuan (R118.7 million) to buy out Japan Tobacco and the Xiamen United Development Group, the China Daily said, citing Huamei chairman Zhang Yuedong.
Xiamen Cigarette Factory started production in cooperation with the US group RJ Reynolds Tobacco in the 1980s, and then jointly established Huamei in 1986 to produce the Jinqiao and RJR's Camel brands of cigarettes.
In 1999, Japan Tobacco bought the international operations of RJ Reynolds.
"As the three shareholders have set different strategies for their respective development, we agreed to stop the cooperation," Zhang said.
China, home to 350-million smokers and the world's biggest tobacco market, has been reluctant to open the industry to foreign companies in spite of intense lobbying by some of the world's largest cigarette groups.
The country's only three joint-venture cigarette making companies - Huamei, Rothmans Tobacco and Shanghai Gaoyang International Tobacco - were all approved in the 1980s as China tried to modernise the industry.
In July, British American Tobacco said the State Council, China's cabinet, had approved its plan to build a $1.5-billion cigarette factory in China.
However, the State Tobacco Monopoly Administration and the National Development and Reform Commission (NDRC), China's key economic policy-making body, later denied approval had been given. - AFP