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RJR TOBACCO INTERNATIONAL IS FIRST U.S. COMPANY TO PRODUCE CIGARETTES IN RUSSIA; RJR-PETRO LARGEST CIGARETTE PRODUCER IN RUSSIA

 RJR TOBACCO INTERNATIONAL IS FIRST U.S. COMPANY TO PRODUCE CIGARETTES IN RUSSIA; RJR-PETRO LARGEST CIGARETTE PRODUCER IN RUSSIA
 ST. PETERSBURG, Russia, July 15 /PRNewswire/ -- R.J. Reynolds Tobacco International, Inc., today announced that it has entered into a partnership with AS-Petro, one of the largest and most modern cigarette factories in Russia, for direct manufacturing of tobacco products for the Russian Federation.
 The partnership, known as RJR-Petro, marks the first major investment by a foreign company in a private cigarette enterprise in Russia. AS-Petro, formerly the Uritski Tobacco Factory, was the first Russian cigarette company to return to private ownership after being state-owned for 72 years.
 R.J. Reynolds Tobacco International becomes the first American tobacco company to begin producing cigarettes in Russia.
 RJR Tobacco International will make a substantial investment in new state-of-the-art equipment as part of a long-term commitment to improve quality and significantly increase production of local cigarette brands. When installation of the new machinery is completed, RJR-Petro's annual capacity will increase to 22 billion cigarettes, making RJR-Petro the largest producer in the country.
 "This partnership is a reflection of our strong belief in the future of St. Petersburg," said Dale F. Sisel, president and chief executive officer of R.J. Reynolds Tobacco International. "We are particularly proud to be a member of the community at this moment in its history. It is our goal to be a model of success for the new economic development beginning in the region."
 Sisel said that RJR-Petro will play a major role in alleviating the chronic shortage of cigarettes available to Russian consumers. Severe cigarette shortages in Russia two years ago resulted in riots and strikes. The crisis was resolved temporarily through massive imports of cigarettes from Western producers. However, a deficit estimated at more than 100 billion cigarettes a year continues to exist.
 "But this is more than a commercial partnership," Sisel said. "It also represents an investment in the people of St. Petersburg. Our partnership means jobs, American technology, and a better product. Together, we will build the largest and most efficient cigarette manufacturing facility in Russia."
 In addition to the investment in equipment and technology, Sisel also announced an advanced management training program for business and government leaders in St. Petersburg to be developed by Duke University's Fuqua School of Business through funding by RJR Tobacco International. Separately, Sisel presented on behalf of RJR-Petro a gift of $100,000 to be used to upgrade equipment at the St. Petersburg Higher Administrative School, a municipal training institution.
 Sergey Akoulov, formerly director of AS-Petro, applauded the partnership and its significance to the city of St. Petersburg.
 "We are particularly proud to unite with one of the world's leading cigarette manufacturers," Akoulov said.
 "Our two companies worked together for several years toward the realization of this venture. In the process, we became friends as well as partners, and today we share a common goal to produce the highest quality cigarettes available in Russia. This partnership will bring enhanced social and economic benefits to the city of St. Petersburg."
 RJR-Petro will produce high quality and affordable filter cigarettes, as well as traditional Russian oval cigarettes and papirosi, using primarily local tobacco and materials. The cigarettes will be sold for rubles. RJR American-blend brands will be phased in as component sourcing is resolved.
 RJR Tobacco International will provide experienced technicians for on-site training in all areas of cigarette manufacturing, including advanced production and maintenance systems, product development, leaf blending and processing, quality control management, computerized financial and production control.
 The company will also work with western tobacco suppliers to implement programs for improving domestic tobacco agriculture, as well as materials such as paper, filter and packaging materials.
 R.J. Reynolds Tobacco International is one of the world's leading producers and marketers of cigarettes. Its parent company, RJR Nabisco, Inc., is one of the largest consumer products companies in the world, with 1991 sales of nearly $15 billion.
 -0- 7/15/92
 /CONTACT: Brenda Follmer of R.J. Reynolds Tobacco International, 919-741-3160/ CO: R.J. Reynolds Tobacco International, Inc.; RJR-Petro ST: IN: TOB SU:


BR-EA -- AT008 -- 9601 07/15/92 13:39 EDT
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Date:Jul 15, 1992
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