Altria Group announced on Monday its acquisition of e-cigarette startup NJOY for $2.75 billion, aiming to bolster its portfolio of smoke-free products.
The purchase grants Altria, known for Marlboro cigarettes, full global ownership of NJOY’s e-vapor product line, which includes the NJOY ACE, the only pod-based e-vapor product authorized by the FDA.
“We believe we can responsibly accelerate U.S. adult smoker and competitive adult vaper adoption of NJOY ACE in ways that NJOY could not as a standalone company,” said Altria CEO Billy Gifford.
This move follows Altria’s recent divestment from Juul Labs, an electronic cigarette maker.
Initially acquiring a stake valued at $12.8 billion in 2018, Altria’s relationship with Juul deteriorated amidst regulatory scrutiny and numerous lawsuits alleging underage targeting. Recently, Altria’s stake in Juul was appraised at $250 million.
Facing financial distress, Juul nearly filed for bankruptcy in November, with its products subjected to FDA scrutiny resulting in a temporary nationwide removal last year. Altria terminated its noncompete agreement with Juul in September.
The Altria-NJOY deal includes $500 million in cash payments contingent upon specific regulatory outcomes related to NJOY products.
NJOY stands out among vaping companies with six products fully approved for sale by the FDA, enhancing its appeal under federal regulatory scrutiny.
“We believe the strengths of our commercial resources can benefit adult tobacco consumers and expand competition,” Gifford emphasized.
