Altria is purchasing full global ownership of privately-held NJOY to take control of the only pod-based e-vapor product with market authorizations from the U.S. Food and Drug Administration (FDA).
The $2.75 billion cash deal includes an additional $500 million in cash payments contingent upon regulatory outcomes with respect to certain NJOY products.
Altria has multiple sources of funding, including committed short-term bank financing and an expected $1.7 billion payment from Philip Morris International by July 2023.
A man vapes in a street in Auckland, New Zealand, on Dec. 9, 2021. New Zealand on Tuesday passed into law a unique plan to phase out tobacco smoking by imposing a lifetime ban on young people buying cigarettes. (AP/David Rowland / AP Images)
Altria CEO Billy Gifford said, "We believe we can responsibly accelerate U.S. adult smoker and competitive adult vaper adoption."
"As a result of this transaction, Altria’s enhanced smoke-free portfolio will include 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 added.
Currently, the e-vapor sector is the largest smoke-free category in the U.S.
E-vapor is the largest US smoke-free category
In 2022, the sector Included early 14 million U.S. adult tobacco consumers, including 9.5 million exclusive adult vapors. The sector generated approximately $7 billion in U.S. retail sales; and represented approximately 15% of total estimated equivalized U.S. tobacco volumes and more than 50% of total estimated equivalized smoke-free tobacco volumes, according to U.S. E-Vapor Marketplace and Regulatory Dynamics.