Jordan's Union Tobacco To Expand Into Dubai, Africa In 07

Thursday, Oct 19, 2006

BEIRUT (Zawya Dow Jones)--Amman-based Union Tobacco & Cigarette Industries, a unit of Union Group, has said that it will increase production capacity in Dubai and Jordan, and expand into Africa next year.

"We want to invest around $5 million in Jordan and a similar amount in Dubai to increase our production capacity in 2007," Jack Koro, assistant general manager at Union Tobacco, told Zawya Dow Jones Wednesday.

Koro said that the company's manufacturing plant in Dubai's Jebel Ali Free Zone was set up in 2005 with a capital of $5 million and with annual production capacity of 1.5 billion cigarettes.

By injecting another $5 million into the capital of the Dubai unit next year, the company plans to double its production capacity there to reach 3 billion cigarettes.

"We will also increase our production in Jordan by 50% to reach 15 billion cigarettes per year from our current production of 10 billion," Koro said.

The company also plans to set up production plants in West and East Africa.

Koro didn't say which African countries the company is planning to invest in, but said that the targeted investments in the continent will top $5 million.

"Our intention is to target countries which are opening their markets like Algeria and Morocco, but we are not sure which country to tap into because we want to apply for licenses first. We will then have to see if were are granted the licenses," Koro said.

UTOB manufactures its own cigarette brands for the Jordanian market and to export.

The company is capitalized at 15 million Jordanian dinars ($21.2 million) and has a market capitalization of JOD96 million.

-By Nadim Issa, Zawya Dow Jones, +961 1 985757, nadim@zawya.com

(END) Dow Jones Newswires

10-19-06 0415ET