Altria Group, the company responsible for creating Marlboro cigarettes, agreed to buy NJOY, a leading manufacturer of nicotine vapor products.
The deal, which is valued at a minimum of $2.75 billion, could be a huge step for Altria as the company looks to remain competitive in a world with fewer cigarette smokers.
Altria previously tried investing in the popular vaping product Juul, however, after putting roughly $13 billion into the company Juul's stock quickly slumped to the point of near bankruptcy. Juul was targeted by numerous lawsuits and allegations that the company intentionally targeted minors with products and advertising. Since then, the company has been able to stabilize but is no longer the leader that it used to be.
Altria’s newfound interest in NJOY appears to be a much safer alternative to Juul as NJOY is one of the few e-cigarette manufacturers that have clearance from federal regulators. In addition, the company is working on a new product that requires a Bluetooth connection in order to operate. This will force users to verify their age with the hopes that underage users will be unable to use the product.
Source: Wall Street Journal