signing an exclusive deal to locally distribute the products of US-firm R. J.

Reynolds Tobacco International.

RJR is the second largest tobacco firm in the world.

Three of its cigarette brands, Camel, Salem and Winston, are market leaders in Bermuda. With its lesser-know Vantage brand, RJR holds a 30 percent share of the local market.

Ms Joanne Robins, RJR's local representative, said yesterday: "The appointment of Winter Cookson as our sole agent marks the beginning of a new and aggressive marketing strategy for the local market.

"By establishing an exclusive distributorship, RJR hopes to market its products on a more competitive level in an effort to gain a greater market share.'' Winter Cookson already distributes RJR food products, including well known brands such as Nabisco cookies and Planter's Life Savers.

The deal has already triggered an aggressive response from rival tobacco distributors Pitt and Co. and Tobacco Associates, which have long held a duopoly on the Island.

Both companies have jointly distributed RJR's brands for many years, but will no longer be able to buy them directly from RJR.

Instead they will have to buy the products from a third party wholesaler in the US or from Winter Cookson.

The two companies felt sufficiently threatened by the new arrangement to place a joint advertisement over half a page in yesterday's Royal Gazette .

Part of the advertisement stated: "In early September a third wholesaler is set to enter the market and will offer a limited range of secondary brands.'' It reiterated that both firms would continue to sell RJR's products. But the advertisement angered Ms Robins, who said it was misleading.

"We're a little concerned about this advert,'' she added.

"As of Friday, Tobacco Associates and Pitt and Co. will no longer be dealing with RJR direct.

"Should they continue to sell RJR products in their vending machines they will have to get them from Winter Cookson.'' But she said she realised that some firms in Bermuda circumvented exclusive dealership rights by obtaining products from "middlemen'' in the US.

Mr. Ken Hockenhull, Pitt and Co.'s general manager, would not reveal where he intended to obtain RJR's cigarette brands from in the future.

"I never disclose my sources,'' he said. "But I can guarantee we will continue to sell all brands. Anything to the contrary is inaccurate.

"We take supplies from all around the world. As far as we're concerned, this Winter Cookson will not be offering Camel, Winston and Salem on an exclusive basis.'' Mr. Michael Davis, Winter Cookson's managing director of finance and administration, said his firm was approached by RJR to become its exclusive local tobacco distributor.

"It makes sense,'' he said. "It falls right in line with other items from RJR which we distribute.

"We're delighted with the deal and will be doing all we can to increase RJR's market share in the local tobacco industry.'' To make way for its new tobacco interest, Winter Cookson is closing down its Animal and Garden House store in Cemetery Lane, Pembroke. The 10,000 square foot, two-storey building will be used for distributing tobacco.

Mr. Davis said his firm was hoping to sell the pet feed and supplies business as a going concern to be housed elsewhere.

Mr. Davis denied that Winter Cookson has been unduly affected by recent mergers involving some of its rivals which has changed the face of the local wholesale industry.

For example, businessman Mr. Ward Young, who already ran BGA, took over Weldon and then Purvis Distributors. More recently, Butterfield and Company announced it was merging with Vallis and Company.

"The mergers will not affect us at all,'' said Mr. Davis. "We're waiting in the wings to see how it will affect the companies involved.

"We feel, at board level, that we're on the right track just staying as we are.''