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WEDNESDAY, NOVEMBER 25, 2009
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Tobacco Giant Plans Spinoff of Overseas Arm

Philip Morris unit, less vulnerable to lawsuits, can focus on growth

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(Newser) – Altria, the world's largest tobacco company, wants to break its Philip Morris International unit off from its US counterpart, Bloomberg reports, to pursue greater overseas growth while insulating it from health-related US lawsuits. "Tobacco is growing overseas, while in the US it's in decline, making a reasonable argument for separating the two entities,'' says an analyst.

The move, which US regulators must approve, is expected to be final in January, and it could save the company $250 million. Altria has struggled in the face of falling US smoking rates, cheaper competitors, and the burden of a $246 billion settlement with states. Philip Morris USA will concentrate on smokeless tobacco products, such as Marlboro snuff.

FILE PHOTO Philip Morris Changes Name To Altria
FILE PHOTO Philip Morris Changes Name To Altria   (Getty Images)
A Marlboro cigarette burns as it sits on a pack of Marlboro cigarettes in this Jan. 31, 2007 file photo in Trenton, N.J. Altria Group plans to spin off its Philip Morris International cigarette unit, its board announced Wednesday, Aug. 29, 2007. (AP Photo/Mel Evans, file)
A Marlboro cigarette burns as it sits on a pack of Marlboro cigarettes in this Jan. 31, 2007 file photo in Trenton, N.J. Altria Group plans to spin off its Philip Morris International cigarette unit,...   (Associated Press)
Steve Martino smokes a Marlboro cigarette in Center City Philadelphia on Wednesday, Aug. 29, 2007. Earlier, Altria Group's board announced its plans to spin off its Philip Morris International cigarette unit, makers of the popular Marlboro cigarette brand. (AP Photo/George Widman)
Steve Martino smokes a Marlboro cigarette in Center City Philadelphia on Wednesday, Aug. 29, 2007. Earlier, Altria Group's board announced its plans to spin off its Philip Morris International cigarette...   (Associated Press)
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Closing the NY headquarters will also save money
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