ATHENS (Reuters) - Marlboro maker Philip Morris (PM.N) will invest 300 million euros ($323.76 million) in its Greek unit Papastratos to convert the cigarette plant into a maker of tobacco sticks for its smokeless IQOS product, executives said on Thursday.
Launched in 2014, the IQOS device heats real tobacco refills to produce tobacco-flavored vapor instead of burning it, which produces hazardous smoke and tar. It is effectively hybrid real and electronic cigarettes.
“We are implementing what Greece needs right now, investments, new jobs and exports,” Papastratos Chief Executive Christos Harpantidis told reporters.
“We will be making a product that will be exported to more than 30 countries in the world.”
Greece’s economy, battered after a seven-year debt crisis, is thirsty for investments to help bring down an unemployment rate of 23 percent.
Papastratos, with annual sales of 1.3 billion euros, has a 40 percent share of the domestic market and employs 800 workers. Philip Morris International makes six of the world’s top 15 international brands and products sold in more than 180 markets.
The project will entail three new buildings at Papastratos’ facility in Aspropyrgos, outside Athens, with new lines of tobacco processing and production of refills for IQOS. Executives said it will create 400 new jobs.
Papastratos, which currently manufactures 12 billion cigarettes annually and exports 60 percent, will be turning out 20 billion refills a year, absorbing a significant amount of Greek tobacco production.
Reporting by George Georgiopoulos Editing by Jeremy Gaunt