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April 1998
Volume 25
Number 2

RETAILER & TOBACCO INDUSTRY NEWS

Tabacalera Completes Purchase of Max Rohr
Tabacalera S.A. of Madrid completed the purchase of Max Rohr Importer, Inc., one of the largest U.S. importers and distributors of super premium and premium cigars, on February 12. The acquisition was made by Tabacalera Cigars International (USA), Inc., the company's U.S. subsidiary.

The closing is the final in a series of acquisitions announced in 1997 that included Havatampa, Inc. and two Central American manufacturers of handmade cigars: Tabacalera San Cristobal de Honduras, S.A. de C.V. and Tabacalera San Cristobal de Nicaragua, S.A.

Headquartered in Chatsworth, California, Max Rohr Importers, Inc. operates under the name Hollco-Rohr, and has a product offering of 20 premium brands. The company markets its cigars under a number of well-known brand names including Romeo y Julieta, Joya de Nicaragua, Gispart, Saint Luis Rey, and Jose Martinez.

"We are tremendously excited by the international reach our relationship with Tabacalera will bring for our premium cigars," said Brad Weinfeld, c.e.o. of Max Rohr. "Just as important, Tabacalera will maintain our excellent relationships with other independent cigar manufacturers in the Caribbean and Central America that have been producing our premium and super premium brands."

Fader's Merger Transfers Company's Leadership Outside of Family After Three Generations
Ira B. "Bill" Fader, Jr., president of A. Fader & Son, Inc. and managing director of the RTDA, announced the merger of A. Fader & Son with Lancaster Venture Corporation, a marketer and distributor of cigars in Pennsylvania. The new company, Fader's, will retain its six retail establishments, located throughout the greater Baltimore metropolitan area and central Pennsylvania, as well as its employees. The terms of the merger were not disclosed.

Fader, the third generation to head the noted tobacconist, whose first store was opened in 1891, is stepping down as president. He will be replaced by Michael J. Goeller, formerly president of Lancaster Venture Corp. Fader will continue to work for the company in the capacity of executive vice president and serve as special advisor to Goeller.

"This is a very exciting day for Fader's," said Fader. "With the merger, the 107-year tradition of fine quality tobacco and tobacco-related products and service will continue unchanged, and Fader's will have the opportunity to enter markets previously inaccessible to us." These new markets are the country club and restaurant accounts that Lancaster distributed cigars to.

Fader's reports sales are exceedingly strong and have increased steadily in recent years with the resurgence of the premium cigar market. According to Fader, last year's sales were the highest in the company's history.

Bits & Pieces
Now a cigar glut? Both Swisher International Group Inc. and Consolidated Cigar Holdings Inc. released statements declaring that 1st quarter 1998 earnings would be well below original expectations, with little or no earnings growth. Consolidated said an excess of historically unknown brands in the marketplace and production problems in the company's supplier's new facility in Mexico contributed to the reduced sales. Consolidated expects normal ordering, purchasing and production patterns will resume once wholesalers reestablish their customary balance of product. Swisher blamed excess wholesale inventories of premium and mass market large cigars and a moderation in the growth of retail sales for the sales and earnings drop.


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