[Intl-tobacco] Japan Tobacco to sell drug business

[Robert Weissman]

Japan Tobacco to sell drug business
Source: Reuters, Thursday, 2/8/01

TOKYO, Feb 8 (Reuters) - Japan Tobacco Inc, the world's third-largest
tobacco group, said on Thursday it would spin off its drug and healthcare
business as part of a medium-term restructuring plan aimed at focusing on
core operations.

JT will sell most of its over-the-counter (OTC) drug and healthcare
product operations -- currently run by its wholly owned subsidiary Lifix
Inc -- to Japanese drug maker Nichiko Pharmaceutical Co Ltd as early as
April. The company declined to disclose the value of the deal.

JT's health drinks business, which is also owned by Lifix, will be
transferred to the tobacco maker's food and soft drink division, the
company said.

A JT spokesman said the firm had not decided whether to liquidate Lifix
after the deal, adding that it planned to continue focusing on its
prescription drug businesses.

The news is the latest in a series of announcements on the company's
streamlining plans.

The former state monopoly, which is still 66.7 percent government-owned,
last year unveiled a medium-term restructuring plan that included cutting
4,500 jobs, or 13 percent of its global tobacco-related workforce.

The company has said it needs to concentrate on core operations after it
over-diversified following privatisation in 1985.

Earlier this week, JT said it planned to sell all 25 outlets of its Burger
King fast food chain in Japan to rival Japanese hamburger chain Lotteria
Co by the end of March.

Thursday's announcement came after the close of trade on the Tokyo and
Osaka stock markets. Shares in JT rose 1.47 percent to 830,000 yen, while
Nichiko Pharmaceutical slumped 4.03 percent to 143 yen.