Altria Makes Minority Investment in Juul

Better positions tobacco company in e-cig market; provides infrastructure, services to e-vapor company

RICHMOND, Va., and SAN FRANCISCO -- Altria Group Inc. has signed and closed a $12.8 billion investment in Juul Labs Inc., a maker of electronic cigarettes and e-vapor products. The investment represents a 35% economic interest in Juul, valuing the company at $38 billion. Altria will participate in the e-vapor category only through Juul, it said.

Altria’s stated strategic rationale for the investment in Juul is that it:

  • Provides a significant stake in the largest and fastest growing e-vapor company with a highly talented management team, successful in-market products and strong innovation pipeline.
  • Offers exposure to strong revenue and volume growth opportunity with attractive unit economics and to significant international growth plans and global e-vapor profit pool.
  • Better positions Altria with adult smokers interested in alternatives while continuing to compete vigorously in all other tobacco product markets.

The service agreements will accelerate Juul's mission to switch adult smokers to e-vapor products, Altria said. The investment complements Altria's noncombustible offerings in smokeless and heat-not-burn, upon U.S. Food and Drug Administration (FDA) authorization of IQOS.

San Francisco-based Juul will remain fully independent, the companies said, but it will have access to Altria's infrastructure and services.

Altria will provide Juul access to its tobacco products' retail shelf space, allowing Juul's tobacco and menthol-based products to appear alongside combustible cigarettes. Juul's flavored products will continue to only be available on

Altria will enable Juul to reach adult smokers with direct communications through cigarette pack inserts and mailings to adult smokers via Altria companies' databases. Altria will apply its logistics and distribution experience to help Juul expand its reach and efficiency and Juul will have the option to be supported by Altria's sales organization, which covers about 230,000 retail locations.

"We are taking significant action to prepare for a future where adult smokers overwhelmingly choose noncombustible products over cigarettes by investing $12.8 billion in Juul, a world leader in switching adult smokers," said Howard Willard, Altria's chairman and CEO. "We have long said that providing adult smokers with superior, satisfying products with the potential to reduce harm is the best way to achieve tobacco harm reduction. Through Juul, we are making the biggest investment in our history toward that goal. We strongly believe that working with Juul to accelerate its mission will have long-term benefits for adult smokers and our shareholders."

“Today, we have been joined by an unlikely—and seemingly counter-intuitive—investor in our journey,” said Kevin Burns, CEO of Juul. “We understand the controversy and skepticism that comes with an affiliation and partnership with the largest tobacco company in the U.S. We were skeptical as well. But over the course of the last several months, we were convinced by actions, not words, that in fact this partnership could help accelerate our success switching adult smokers. We understand the doubt. We doubted as well. We made it very clear that any investment would need to meet demanding and specific criteria to ensure that they are committed to our mission.”

Altria will be subject to a standstill agreement under which it may not acquire additional Juul shares above its 35% interest. It agreed not to sell or transfer any Juul common shares for six years from closing. Altria said it will participate in the e-vapor business only through Juul as long as Altria is supplying Juul services, which Altria has committed to doing for at least six years.

Richmond, Va.-based Altria's subsidiaries include Philip Morris USA Inc., U.S. Smokeless Tobacco Co. LLC, John Middleton Co., Sherman Group Holdings LLC and its subsidiaries (Nat Sherman), Nu Mark LLC, Ste. Michelle Wine Estates Ltd. and Philip Morris Capital Corp. The brand portfolios of Altria's tobacco operating companies include Marlboro, Black & Mild, Copenhagen and Skoal.

Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.


Exclusive Content

Snacks & Candy

What Convenience-Store Consumers Are Craving in Candy, Snacks

Unwrapping the latest treats and trends from the Sweets & Snacks Expo

Snacks & Candy

Convenience-Store Shoppers Are Sweet on Private-Label Candy

How 7-Eleven, Love’s are jumping on confection trends


More from our partners