With Njoy, Altria tries its luck again on electronic cigarettes

Altria, the maker of Marlboro cigarettes in the United States, is in talks to buy Njoy, an e-cigarette company for at least $2.75 billion (€2.58 billion), as reported by a Wall Street Journal article. Although the negotiations could still fail at this stage, the finalization of the acquisition could be announced in the coming days.

Njoy's buyout value could be increased by an additional $500 million if certain regulatory approvals are obtained, such as FDA approval for marketing of menthol-flavored products, which is currently under review.

A range of products authorized by the FDA

Njoy received approval from the Food and Drug Administration (FDA) last year to continue selling its Ace tobacco-flavored e-cigarette brand and its Njoy Daily disposable device, as part of the regulator’s review of 6.7 million vaping products. The FDA is responsible for ensuring that new tobacco and nicotine products are vetted to ensure they meet certain health standards. No new product can legally be marketed without this prior marketing authorization from the FDA. Other products have not been approved for sale, such as Juul products, which the FDA banned in 2022. However, with the FDA’s decision stayed by the federal court in Washington, Juul products are still on sale in the United States.

After Juul's failure, Altria tries its luck again with e-cigarettes

The Njoy acquisition comes five years after Altria spent nearly $13 billion to acquire a 35% stake in Juul, the former leader in e-cigarettes in the United States. Juul's stock market valuation has since collapsed following changes in the regulatory framework and multiple lawsuits against the manufacturer. Juul has been criticized for its aggressive marketing strategies aimed at teenagers. In particular, the highly addictive products marketed by Juul were associated with intense advertising campaigns, while the ban on sales to minors was deliberately ignoredThe acquisition by Altria helped strengthen these strategies, with the manufacturer assisting Juul in the sale, marketing, marketing and promotion of e-cigarettes.

Njoy, one of the pioneers of electronic cigarettes in the United States

With the introduction of a disposable cigarette-shaped vaping device on the US market in 2007, Njoy was one of the first players in the electronic cigarette market in the United States. However, following the commercial failures of new flavored products, the withdrawal of certain investors from 2016 and the arrival of new competitive players, the company filed for bankruptcy protection in 2017. The introduction and commercial success of a new generation of electronic cigarettes allowed Njoy to gradually attract investors and the attention of tobacco manufacturers again. The latter have been seeking to diversify for several years in order to cope with the continued decline in sales of traditional cigarettes. In 2019, Njoy was valued at five billion dollars.[1].

FT

[1] The Wall Street Journal, NJOY, a Once Bankrupt E-Cigarette Maker, Now Seeks $5 Billion Valuation, 01/05/2019, (accessed 01/03/2022)