* Says tough to pursue very large deals due to anti-trust issues
* Says already developing new smokeless products (Adds heat-not-burn tobacco strategy)
TOKYO, Jan 17 (Reuters) - Japan Tobacco Inc, which is on the hunt for overseas acquisitions to offset a shrinking home market, is working on several possible deals as it targets growth in Asian and other emerging markets, its new chief executive said on Wednesday.
Masamichi Terabatake told Reuters he saw the potential for deals in South America, Africa and the Middle East, in addition to Asia, where his company is already active, having spent about $2 billion last year on tobacco businesses in the Philippines and Indonesia.
"We have a long list and a short list (of potential targets), there are various deals in the works," Terabatake, who became CEO of the world's fourth-largest tobacco company on Jan. 1, said in an interview.
Japan Tobacco, one-third owned by the government, had an 8.4 percent share of the global cigarette market in 2016, Euromonitor International data shows.
The former state monopoly is accelerating its overseas M&A drive as it grapples with falling cigarette sales in Japan, where it commands 60 percent of the market.
Terabatake, 52, declined to comment on specific deals, including whether his company is interested in British rival Imperial Brands.
Analysts say Japan Tobacco would likely be unable to buy Imperial's entire business and would need to join forces with other buyers to clear antitrust hurdles, given Imperial's big market presence in United Kingdom and other countries.
But Terabatake said that "very large deals are likely to face antitrust issues. I think it's very difficult to successfully complete deals we cannot do alone."
Japan Tobacco has forecast 92 billion cigarette sales in Japan for 2017, down 13.4 percent from a year ago, as a growing number of smokers are switching to "heat-not-burn (HNB)" tobacco.
Japan has become a fertile market for HNB products as the country's regulations effectively ban e-cigarettes that use nicotine-laced liquid.
Philip Morris International is ahead in the segment with its iQOS device, which was launched in Japan in 2014 and expanded nationwide in April 2016.
Japan Tobacco, which rolled out its Ploom Tech smokeless tobacco product in central Tokyo in June last year after production delays, is now trying to catch up with IQOS and British American Tobacco's glo.
Terabatake said his company is trying to resolve supply bottlenecks by ramping up production capacity. "We expect HNB products to reach 30 percent of Japan's total tobacco market in 2020 and we need to take actions accordingly," he said.
The CEO also said Japan Tobacco is already developing other new smokeless products. He declined to comment on the timing of new product launches but said they are "a lot nearer" than five years from now. (Reporting by Taiga Uranaka and Ritsuko Shimizu; Editing by Chris Gallagher and Muralikumar Anantharaman)