[Intl-tobacco] Morocco privatization

[Robert Weissman]

 Morocco opens tender for 80 pct of tobacco stake - Reuters

 Thursday, February 20, 2003
 RABAT, Feb 20 (Reuters) - Morocco on Thursday launched an international
tender to sell an 80 percent stake in its tobacco
 monopoly for a minimum of 6.4 billion dirhams ($643 million).

 The finance and privatisation ministry set a May 30 deadline for the
sale of nearly 5.7 million shares in Regie des Tabacs,
 averaging 1,123.6 dirhams per share, a statement said.

 Half a dozen international tobacco firms are following the sale, which
had been initially planned for 2002, including
 Franco-Spanish Altadis ALT.MC , British American Tobacco Plc BATS.L ,
Japan Tobacco 2914.T and Philip Morris Companies
 Inc. MO.N .

 Established in 1967 in Casablanca, Regie des Tabacs has an annual
turnover of some $800 million and yields the Moroccan
 Treasury $600 million in taxes. It has four processing plants and
20,000 sales outlets.

 A financial analyst said it was difficult to assess if the average
share price of 1,123.6 dirhams asked by the government was
 reasonable. "Regie is not listed so it does not publish its books," he
said.

 Officials at French bank Credit Lyonnais CRLP.PA and its Moroccan
subsidiary Credit du Maroc CDM.CS , which acted as
 advisers for the privatisation, were not immediately available for
comment on methods used to evaluate the 80 percent stake.

 The analyst said the sale was set to be a success "because of the
attractive liberalisation process which provides a monopoly
 umbrella of four years, in addition to the profitability and big
potential of the tobacco industry here."

 The winner of the tobacco tender will benefit from the present monopoly
status over imports and distribution of manufactured
 tobacco until the end of 2007.

 Imports of raw tobacco and production and export of manufactured
tobacco are expected to be liberalised from 2005.

 The privatisation ministry said it would sell the stake to the highest
bidder provided that it met its technical and financial criteria.

 Firms wishing to bid for the tender must have a minimum consolidated
equity capital or minimum stock market capitalisation of
 1.5 billion euros, and at least half of their total net turnover must
come from the tobacco industry.

 Morocco has set a $1.5 billion target for privatisation receipts in its
2003 budget and the tobacco monopoly's stake is expected to
 be the main offer this year.

 The largest public companies privatised so far include Maroc Telecom,
35-percent owned by Vivendi Universal EAUG.PA .
 Sell-offs planned in the next five years include Royal Air Maroc and
Morocco's largest bank, Banque Centrale Populaire.

 http://www.reuters.com/[...]News&storyID=2259395