Thu, Jun 24, 2004 - Page 11 News List

Long Life brand readies for China debut

Joyce Huang  /  STAFF REPORTER

The state-run Taiwan Tobacco and Liquor Corp (台灣菸酒公司) is preparing to enter the lucrative Chinese tobacco market late this year, chairman Morgan Hwang (黃營杉) said yesterday.

"After gaining preliminary approval, the Long Life (長壽) cigarette may officially tap into the Chinese market as early as late October," Hwang told reporters.

Hwang added that Chinese authorities may only allow 30,000 boxes of Long Life cigarettes, worth NT$200 million, to enter its markets in the first year, which he called a "small yet significant step to gain market share in China."

Each Long Life pack will sell for 15 yuan in provinces along the east coast and the Yangtze River (長江), according to Hwang.

Although it is interested in entering China's beer market, the state-run monopoly has met a setback in introducing its Taiwan Beer to China, which appears to boycott the beer for political reasons. China has refused to approve the Taiwan Beer brand since the name may suggest the nation's sovereignty.

"China has been delaying the application process since March for no reason," Hwang said, adding that he suspects it may have something to do with the presidential election. Hwang urged China to put aside ideology when reviewing its business plan, adding that the brand name is unlikely to change.

"We hope that China can live up to its WTO commitments and grant a fair national treatment," Hwang said.

Vowing to achieve NT$3 earnings per share and a profit goal of NT$10 billion this year, Hwang said the company will soon propose a new privatization plan to the Cabinet as it is sure to fail to meet the deadline next month to initiate its government-backed privatization plan. He said that next Tuesday the company's board will finalize the privatization plan, which proposes to release the company's 350,000 shares to the open market as soon as next year.

"Once the Cabinet gives its go-ahead, the initial public offering will take another 10 months to prepare," Hwang said.

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