Philip Morris Serbia to Cut Jobs

Belgrade | 31 July 2009 | Nis-based cigarette manufacturer DIN, majority-owned by Philip Morris International, needs reorganisation that will include redundancies, the company’s CEO Skip Bornhuetter said on Friday.

“The future of DIN depends mostly on flexibility, efficient spending policy, and the good organisational structure of the factory,” Fonet news agency quoted Bornhuetter as saying.

The world’s largest cigarette maker, Philip Morris pledged €387 million for a 66.45 per cent stake in DIN in the Serbian company’s 2003 privatisation.

Bornhuetter said earlier that problems in the company’s operations had been aggravated by an increase in excise tax and the elimination of state subsidies for tobacco producers.

Serbia’s only other cigarette manufacturer, DIV, which is majority-owned by British American Tobacco, laid-off 166 of its 319 employees two weeks ago, due to imminent financial losses.

DIN employees who are made redundant will receive average severance pay of €16,000, which is higher than the amount proposed by Serbian law.

Additionally, the factory made a deal with companies – which are to take over some of the company’s business – to take into consideration the fired employees in filling other positions. Source: Balkaninsight

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