Altria cleared the decks at the tail end of the year by removing its competing products and Juul’s board of directors signed off on the move on 19th December. The sum places a valuation on Juul Labs equating to over £30 billion.
Juul had always striven to distance itself from the tobacco industry, even though its beginnings were firmly rooted there. The company angered many in the vape and harm reduction community when it agreed with the Food and Drug Administration that flavours caused a problem with teen uptake.
It has been reported that Juul also held talks with British American Tobacco and Japan Tobacco International.
Juul also removed some of its flavoured products from sale in shops and petrol stations in the United States. It claimed it was supporting Scott Gottlieb’s call for greater responsibility from the industry. The deal means that Juul will now be seen as part of the tobacco industry. Signing conditions included:
- Altria adding Juul coupons to packets of Marlboro cigarettes
- Altria relinquishing prime in-store shelf space to Juul merchandise
Juul currently employs over 1,500 people who stand to benefit from the agreement; $2 billion has been set aside from the capital to be distributed among staff.
Juul’s Kevin Burns (who made the video that infuriated vapers) commented through a press release: “Today, we have been joined by an unlikely – and seemingly counterintuitive – investor in our journey. Altria today announced a minority investment of $12.8 billion into JUUL for a 35% ownership in the company along with services to accelerate our mission.”
“We understand the controversy and skepticism that comes with an affiliation and partnership with the largest tobacco company in the US. 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.”
“As a result, we are excited about the opportunity presented by Altria, its investment and service agreements. We are fully committed to our mission and our values. We know we need to earn trust and prove that this partnership may provide the opportunity to improve upon our early successes and better equip us to tackle the opportunities and challenges that lie ahead. When you take a step back, our success ultimately depends on our ability to get our product in the hands of adult smokers and out of the hands of youth. When adult smokers try it, it works. And, the impact is life changing. This investment and service agreements helps us do just that.”