| Mighty Corporation 皇冠煙廠 | |
| Type: | Private |
| Foundation: | 1945 |
| Founder: | Wong Chu King |
| Key People: | Oscar Barrientos (President) |
| Industry: | Tobacco |
| Area Served: | Philippines |
Mighty Corporation is a Filipino corporation and was the second largest cigarette manufacturer in the Philippines from 2010 to 2017. On September 8, 2017, Japan Tobacco acquired Mighty Corporation's cigarette business in the amount of ($936 million), paving the way for the full payment of to the Philippine government as part of the agreement for Mighty Corporation to settle its unpaid tax liabilities.[1]
In 1945, the company was established as La Campana Fabrica de Tabacos, Inc. by Wong Chu King with a small cigarette factory in Manila producing a type of native cigarette known as "matamis" (sweet blend). In 1948, a second factory was built in Barangay Olympia, Makati, Rizal. In 1963, a facility for tobacco threshing and redrying was constructed in Malolos, Bulacan where the company's processing plant was later established.[2]
In 1985, the company changed its name to Mighty Corporation and acquired the trademarks of rival Alhambra Industries, Inc. in 1993.
In 2001, the company entered into a cigarette manufacturing agreement with rival Sterling Tobacco Corporation to produce the latter's brands. In 2004, the company entered into a cigarette manufacturing agreement with the Philip Morris Philippines as the latter had acquired the trademarks of Sterling Tobacco Corporation.
The company increased its market share from 3 percent in 2012 to nearly 20 percent in 2013 as a result of consumer down-trading from premium (Marlboro, Lucky Strike, Winston) to low-end brands (Mighty, Fortune). The company endured accusations by rival PMFTC since the implementation of Republic Act 10351, more commonly known as the "Sin Tax Law", in 2012.[3]
In 2014, the company was engaged in talks with British American Tobacco (BAT), the smallest player in the Philippine tobacco market, to explore partnership options.[4]
In 2017, Mighty Corporation completed the sale of its cigarette business to Japan Tobacco in the amount of . The transaction included the company's trademarks, intellectual properties, sales and distribution network, manufacturing equipment and inventories.[5] It also resulted to the domestic manufacturer's tax payment amounting to P40-billion pesos - the largest amount paid in Philippine history by any corporation. The proceeds were to be used to boost the Duterte administration's infrastructure program.[6]
Since the implementation of Republic Act No. 10351 (Sin Tax Law), Philip Morris International (PMI) and PMFTC Inc. accused Mighty Corporation of various issues yet no formal charges or complaint have been filed while the Bureau of Internal Revenue (BIR) has clarified to maintain a neutral position in the ongoing tobacco trade war. BIR Commissioner Kim Jacinto-Henares officially stated that "the burden of proof rests on PMI and PMFTC, they should prove that Mighty Corporation has evaded the government. If they cannot prove their allegation, then they may be liable for libel or slander." She said PMI's current hurdles in the Philippine market could have been avoided if PMFTC agreed to the government's original proposal of adopting a unitary tax system, which aimed to remove the tax rate gap between low- and high-priced cigarette brands. The BIR chief explained a unitary rate system on cigarette could have prevented smokers from down-shifting from high-priced brands, such as Marlboro, Winston and Lucky Strike, to low-priced brands, like Mighty.[7]