$170 million for Hryhoriy Kozlovskyi’s smuggling empire: why the owner of the Vynnyky factory is ready to sell the “gold mine”

The Vynnyky Tobacco Factory named after Hryhoriy Kozlovskyi in search of an investor. Or a buyer?

In recent weeks, rumors have spread across the tobacco market about plans for the Vynnyky Tobacco Factory to change ownership, journalist Yevhen Plinskyi writes.

Moreover, there is even talk of a specific amount for which Hryhoriy Petrovych and his partners are ready to part with the asset that is currently laying “golden eggs.”

The figure being mentioned is $170 million, and some potential investors are reportedly seeking this sum from European financial institutions.

This is understandable, since few investors would risk putting their own money into a profitable yet risky asset. That is why credit financing is being sought.

This raises the question: why would the long-standing beneficiaries of the factory suddenly be ready to exit the dirty tobacco game in which they effectively hold a monopoly?

(It should be recalled that 53% of the illegal cigarette market consists of duty-free products, of which 50% are under the Compliment brand, which is in fact produced in Vynnyky.)

By conservative estimates, the factory’s annual revenue currently stands at around $100 million.

There seems little logic in getting rid of such an asset, which, in addition to steadily growing profits, enjoys strengthened immunity from law enforcement.

You have probably also noticed that any activity by security forces in recent years has had no impact on the factory’s operations.

In addition, since the start of Russia’s invasion in 2022, the Vynnyky Tobacco Factory has allegedly received an informal monopoly from law enforcement structures over cigarette smuggling into Europe.

If one wants to engage in industrial-scale cigarette smuggling, approval from security forces is reportedly possible only on the condition that the exported cigarettes are produced in Vynnyky.

Pay attention to all cigarette seizures by European customs authorities. If not Compliment, then Lifa or Marvel.

Recall even episodes of smuggling disguised as diplomatic cargo organized by the border guards of Deineko. Those shipments also consisted exclusively of Lifa and Compliment.

At the same time, on the Ukrainian side, products from all other manufacturers or counterfeit goods are detained — and almost never the products from Vynnyky. Magic.

So why, under such unique operating conditions and growing profits, have the factory’s beneficiaries begun talking about a possible sale of the asset?

The answer to this question still needs to be determined.

Perhaps the beneficiaries sense that the “golden era” of Vynnyky is nearing its end?

That the reform of the Bureau of Economic Security, the reboot of customs, and recent activities of NABU indicate it is time to wind things down — and best to do so in this way.

Or perhaps the contraband promotion of the factory’s brands in Europe has proven so effective that the factory is simply planned to be relocated through a sale somewhere in Poland or Hungary?

These questions remain unanswered, but the fact that movements are taking place in the illegal tobacco market is undeniable.