Altria Group, Inc. (NYSE: MO) said in a statement that it plans on to spin-off Philip Morris International, though final approval would depend on a January 30th board meeting as well as a favorable ruling from the IRS on tax consequences of any such move.

The spin-off is a logical, if not necessary, move as it would separate the  fast growing international cigarette division, which accounts for two-thirds of Altria profit, from the declining consumption and legal liability of the U.S. cigarette market.

Altria is currently the world's largest cigarette company but the international division has been a particular bright spot with dominant market share in France, Germany, Italy and Spain. Cigarette sales by volume increased 3.3% last quarter compared to a year ago for the international division, while declining by the same amount for the domestic unit.

Earlier this year, Altria spun-off the world's second biggest food company Kraft Foods, Inc. (NYSE: KFT), though for much different reasons - its shrinking profits were hurting Altria's other divisions.

After the proposed spin-off, current Altria Chairman and CEO Louis Camilleri would assume that position at Philip Morris International while current Philip Morris USA head Michael Symanczyk would become the new Chairman and CEO of Altria.

Regardless if the board approves any proposed spin-off, the fact that the company is recognizing the increasing opportunity in the international cigarette market definitely makes MO a stock worth watching in the coming months!

Related Companies
Reynolds American, Inc. (RAI)
Carolina Group (CG)
UST Inc. (UST)