Altria may spin off some cigarette business: report

NEW YORK (Reuters) - The board of the parent company of Philip Morris USA and Philip Morris International is to meet next week to decide whether to spin off the international arm of its cigarette business, The New York Times reported on Saturday.

Citing people with knowledge of the discussions, the Times said the board of the Altria Group Inc. (MO.N) is to meet on Wednesday to weigh the decision as part of a restructuring plan to increase shareholder value.

According to analysts, Philip Morris USA has hindered the stock price because of litigation fears, threats of government intervention and falling U.S. sales figures for cigarettes, the newspaper said.

Officials from Altria, maker of the world's most popular cigarette brand Marlboro, declined to comment about the potential spinoff of Philip Morris International, it said.

Several Wall Street analysts who cover the company said they believed the move was inevitable, the Times said.

"This is something that has been in the works for years," the newspaper quoted an analyst at Citigroup, Bonnie Herzog, as saying. "To me, it's a done deal."

Splitting the companies would let Philip Morris International expand more aggressively abroad through innovation or acquisition, according to analysts cited by the Times.

Meanwhile the U.S. company could focus on expanding into other tobacco products, such as the recent introduction of Marlboro smokeless tobacco, and also make its own acquisitions, analysts said.

The analysts added that the Altria Group would probably remain as a holding company for Philip Morris USA and the company's 29 percent stake in SABMiller (SAB.L), the beer company.