The History of Rothmans, Benson & Hedges in Canada

Rock City Tobacco Company was founded in 1899 in Quebec City’s Saint-Roch district. The founders — brothers Olivier-Napoléon Drouin (who would become mayor of Quebec City in 1910) and Joseph Drouin, along with Joseph Picard — named the company after Cap Diamant, the rocky promontory overlooking the St. Lawrence River [citation:1].

• Peak employment: The factory employed approximately 500 people, mostly women, with about 20 sales representatives across Canada [citation:1].
• Original brands: Rock City produced Craven ‘A’, Black Cat, Sportsman, Corvette, Rose Quesnel, Sweet Rose, Bluebird, and Britannia [citation:1].
• Struggles: Despite early prosperity, Rock City eventually faced financial difficulties and was sold to British Carreras Tobacco Company in 1936 [citation:1].

Rothmans of Pall Mall Canada Ltd. was founded in 1956 [citation:4]. The company began acquiring Canadian tobacco assets, starting with Carreras (which already controlled Rock City) in 1958 [citation:6].

• 1963 — Full control: Rothmans acquired all outstanding stock of Rock City Tobacco Company, becoming the sole owner of the Quebec City factory [citation:6].
• Modernization: New machinery was installed, and the factory expanded in 1957 [citation:1].
• Brand expansion: Rothmans introduced new brands and consolidated its position in the Canadian market [citation:1].

In 1986, Rothmans International merged its Canadian operations with Benson & Hedges Inc. — which was owned by Philip Morris at the time. The new entity was named Rothmans, Benson & Hedges Inc. (RBH) [citation:1][citation:2].

• Ownership split: 60% Rothmans / 40% Philip Morris [citation:1].
• Quebec City factory continues production: Manufacturing remained at the historic Saint-Roch facility, near the Autoroute Laurentienne and the Saint-Charles River [citation:1].

In 1999, British American Tobacco (BAT) acquired Rothmans International. At the time, BAT controlled 90% of the Canadian cigarette market through its ownership of RBH’s 60% stake [citation:1].

• Regulatory concerns: BAT’s near-monopoly raised competition concerns.
• Spin-off announced: Within months of the acquisition, BAT announced it would spin off RBH’s 60% stake as a separate public company on the Toronto Stock Exchange (ticker: ROC) [citation:1].
• Result: RBH became an independent publicly traded company for nearly a decade before Philip Morris International bought the remaining shares.

In the early 1990s, Canadian tobacco companies were accused of facilitating a cigarette smuggling operation. The allegations claimed that companies, including RBH, deliberately supplied products to known smugglers who then illegally exported them to Canada — bypassing Canadian taxes [citation:1].

• The alleged motive: By flooding the market with cheap, untaxed cigarettes, the companies hoped to pressure the Canadian government to lower tobacco taxes on legal products [citation:1].
• Guilty plea: Rothmans, Benson & Hedges and its rival Imperial Tobacco Canada pleaded guilty to charges related to the smuggling scheme [citation:1].
• Penalty: RBH was ordered to pay approximately $500 million in various penalties [citation:1].

In 2008, Philip Morris International (which already owned 40% of RBH since 1986) acquired the remaining 60% of shares for approximately US$2 billion [citation:2].

• Second-largest tobacco company in Canada: At the time of acquisition, RBH held 33% of the Canadian cigarette market [citation:2].
• Headquarters: RBH maintains its headquarters in Toronto, with sales offices across the country [citation:4].
• Workforce: Approximately 780 employees across Canada [citation:1][citation:4].
• IQOS launch (2016): RBH began distributing Philip Morris’s heated tobacco product IQOS in Canada, along with HEETS tobacco sticks [citation:4].

Since 2016, RBH has been the Canadian distributor for IQOS (I Quit Ordinary Smoking) — Philip Morris’s heated tobacco device [citation:4].

• How it works: IQOS heats specially designed tobacco sticks (HEETS) to 350°C — below combustion temperature — producing an aerosol instead of smoke.
• Health claims: Philip Morris markets IQOS as a “better alternative” to cigarettes, though Health Canada has not endorsed such claims.
• Availability: IQOS devices and HEETS are sold in Canada through RBH’s distribution network and licensed retailers [citation:4].
• Regulatory status: IQOS is regulated under Canada’s Tobacco and Vaping Products Act (TVPA).

In 2019, Philip Morris International announced the closure of the historic RBH factory in Quebec City’s Saint-Roch district — ending more than 120 years of continuous tobacco production on the site [citation:4].

• Jobs lost: Approximately 500 employees were affected [citation:4].
• Reason: PMI cited declining cigarette sales in Canada and the shift toward “smoke-free” products as the primary reasons for the closure [citation:4].
• Production relocation: Some manufacturing was consolidated at other facilities.