Japan Tobacco Inc. (JTI) is buying the tobacco business of Bangladesh’s Akij Group for around USD 1.5 billion, making JTI’s acquisition strategy one of the fastest growing in Asia, reported Reuters. The USD 1.5 billion deal is one of the biggest cross-border M&A transactions involving a Bangladeshi company. A JTI press statement said the group will acquire the shares of United Dhaka Tobacco Company Limited with the Japanese entity taking over the tobacco business assets of Akij as well as all the tobacco-related trademarks and design rights from Akij.

“With this investment, we have continued to accelerate our expansion in emerging markets that matter—a key component of the JT Group’s growth strategy. Akij’s substantial market share will place us straight at the number two position in Bangladesh. Thos will enable the expansion of our quality top-line growth,” said Mutsuo Iwai, JTI executive vice-president and president of its tobacco business, in the press statement.

Akij Group runs it tobacco business under Dhaka Tobacco Company Ltd, which also produces the Marlboro brand of cigarette of Philip Morris International (PMI), in Bangladesh.

The Independent tried to contact JTI for clarification on the difference between United Dhaka Tobacco Company Ltd and Dhaka Tobacco Company Ltd. It also asked what would happen to the Marlboro brand. However, JTI did not reply to the queries. Akij is Bangladesh’s second-biggest tobacco company and holds about 20 per cent of the cigarette market in the country, which is the world’s eighth largest cigarette market, according to the statement.

JTI said the deal would add about 17 billion units to the Japanese company’s sales volume.

The Japanese company entered the Bangladesh market in 2015 and held 0.1 per cent market share as of 2017, according to the company’s estimates. Akij, with brands such as Navy and Sheikh, has witnessed a volume growth of about 2 per cent.

According to JTI, the acquisition of United Dhaka Tobacco Co was expected to be completed by the third quarter of this year, pending regulatory clearance.

JTI said that it did not expect the deal to impact its earnings for the current fiscal year. The transaction will be funded with existing cash and loan.

As of June 30, JTI had 237.4 billion yen (USD 2.1 billion) in cash, cash equivalents and short-term investments, according to data compiled by Bloomberg.