JTI-MacDonald Quick Facts
Last Updated February 15, 2007
RJR-MacDonald has carried on manufacturing in the Ontario Street, Montreal, building since 1876. (Photo Courtesy Industry Canada)
Company founded in 1858 in Montreal by merchants William C. and Augustine Macdonald as McDonald Brothers and Co. Tobacco Manufacturers.
Company imports tobacco from Kentucky and sells chewing and smoking "plugs."
In 1866, name changed to W. C. McDonald Tobacco Merchants and Manufacturers. They create a heart-shaped logo and launch company slogan "tobacco with a heart."
In 1876, William takes full control of the company and moves to new, bigger and more efficient plant in downtown Montreal.
William Macdonald becomes pillar of Montreal establishment. He becomes a director of the Bank of Montreal, donates millions of dollars to health and education, mainly at McGill University. He endows a chair that helps the research by pioneer nuclear physicist Ernest Rutherford.
William Macdonald knighted by Queen Victoria in 1898. He adds the "a" into the company name, so it becomes MacDonald Tobacco. He continues philanthropic activities and helps found the University of British Columbia.
Macdonald, a life-long bachelor, dies in 1917, leaving the company to the Stewart brothers who had started as clerks.
The new company president, Walter Stewart, expands business to pipe tobacco and "roll-your-own" cigarettes. In 1922, the company begins production of cigarettes, sold in boxes of 10s, 20s and 50s.
In 1928, company adds a new brand: British Control Export.
In 1935, name is shortened to Export and the "Scottish lassie" wearing the Macdonald of Sleat tartan kilt becomes the brand's distinctive trademark.
JTI Quick Facts
Began as a small Japanese tobacco company in 1898 with a brand called Mild Seven.
Became the Japan Tobacco and Salt Public Corporation in 1949. Actually becomes a public company in 1985.
After takeovers, JT is the third-largest tobacco manufacturer in the world, with 90 cigarette brands, sold in 120 countries.
Company says it had sales of $36.5 billion US in the fiscal year ending March 2004.
Company says it sold 423.5 billion cigarettes that year.
JT also has interests in pharmaceutical and food companies.
Famous brands include:
- Export A
- Mild Seven
During the Second World War, MacDonald supplies cigarettes to Canadian troops. By 1945, it is estimated that 50 per cent of Canadian soldiers smoked Export "A", which cemented the brand preference for years to come.
In the 1960s, Walter's son, David Stewart becomes company president and adds cigars to the company's brands.
In 1974, company sold to R.J. Reynolds of Winston-Salem, N.C.
In 1978, U.S. parent company name changed to RJR-MacDonald Inc.
In 1985, Reynolds merges with Nabisco Brands, when pressure on tobacco companies forces it to diversify.
In 1991, Ottawa sharply raises tobacco taxes. By 1992, it is estimated that 20 per cent of cigarettes sold across Canada and 50 per cent in Quebec, are probably smuggled. By 1994, that figure rises to 60 per cent. Reports say that RJR-MacDonald's market share in Canada rose by 12 per cent in 1992 and 20 per cent in 1994.
In 1998, RCMP raid company headquarters in Montreal, seeking evidence in a smuggling investigation.
In 1999, the Canadian federal government files suit in the U.S. asking $1 billion US from RJR-MacDonald in back taxes avoiding by smuggling in the 1990s. U.S. courts later dismiss the suit because they have no mandate to enforce foreign tax laws.
In 1999, Japan Tobacco founds JT International, with headquarters in Geneva and takes over RJR International, and all the company brands.
In March 2003, the RCMP charge eight tobacco executives with fraud and conspiracy, alleging the company engaged in an "unholy conspiracy" with tobacco smugglers.
In April 2002, MacDonald launches a new low-tar brand called Vantage. Anti-tobacco groups charge that the company is misleading consumers with its low-tar labelling.
In June 2003, facing competition from small, discount manufacturers, some run by First Nations, MacDonald launches two cheap brands Legend and Studio sold mainly in convenience stores in Quebec.
In August 2004, Quebec sends a $1.36-billion tax bill to JTI-MacDonald, asking $440.5 million in back taxes, $283.6 million in penalties and $640.3 million in interest."
On Aug. 24, 2004, JTI-MacDonald files for protection from creditors.
In January 2006, one of the eight senior executives, Stan Smith, pleads guilty to one count of conspiracy. Smith had been the company's vice-president of sales and at a private pre-trial hearing, he claimed more senior executives at the company had developed the conspiracy.
A judge rules Smith will not serve any jail time after pleading guilty to conspiring to smuggle cigarettes, and defrauding the Canadian government of more than $1 billion in taxes. The judge describes Smith as the finest tobacco smuggling informant in the world.