Two recent actions by Altria Group Inc. will alter the organization's vape portfolio and product reach in the United States.
On Friday, the company announced that it has exchanged its entire minority economic investment in Juul Labs Inc. for a non-exclusive, irrevocable global license to certain of Juul’s heated tobacco intellectual property.
And separately, Altria Group, Richmond, Virginia, announced this morning that it has entered into a definitive agreement to acquire NJOY Holdings Inc. for approximately $2.75 billion in cash payable at closing. The transaction terms include additional $500 million in cash payments that are contingent upon regulatory outcomes with respect to certain NJOY products.
“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. "We believe the strengths of our commercial resources can benefit adult tobacco consumers and expand competition."
As a result of the transaction, Altria’s smoke-free portfolio "will include full global ownership of products and technologies across the three largest smoke-free categories and a joint venture with JT Group for the U.S. commercialization of heated tobacco stick products,” he said.
About the Juul deal, he said, “We believe exchanging our Juul ownership for intellectual property rights is the appropriate path forward for our business. Juul faces significant regulatory and legal challenges and uncertainties, many of which could exist for many years. We are continuing to explore all options for how we can best compete in the e-vapor category.”
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