Juul Investors Concerned About Possible Deal With Altria
Juul Labs Inc. was funded by Adam Bowen and James Monsees, two Stanford graduate students, who apparently spent their college days swapping business ideas on ways to disrupt the tobacco industry. And up until now they seemed well on their way to achieving that.
However, news have recently emerged that the San Francisco start-up is engaged in talks with tobacco company Altria Group Inc., about a possible deal. According to media reports, if a deal is struck, Altria will get a chunk of the three-year-old company, which this summer was valued at approximately $16 billion.
Juul criticized for betraying its mission
Naturally, news of these discussions have attracted criticism from multiple entities. “The combination of Altria’s sordid history of spending billions to entice kids to smoke, and Juul’s breathtaking success at hooking a new generation of children on nicotine, could mark an historic setback for lifesaving tobacco control efforts,” said chief executive of the American Heart Association, Nancy Brown.
Additionally, last week The Wall Street Journal reported that current and former Juul employees are outraged by the ongoing talks, saying that a deal with Altria would betray Juul’s stated mission; helping addicted cigarette smokers switch to less harmful products.
If Juul joins Altria, it will loose credibility
Now two of Juul’s investors have joined the discussion, expressing similar concerns. According to an article on Yahoo Finance, the investors, who asked not to be identified for fear of reprisal from Juul’s board and other investors, “expressed concern that Juul was now creating a new generation of nicotine addicts and said if Juul partnered with Altria it would become harder to defend Juul’s mission.” They added that this is not what they signed up for when investing in the company.
Juul’s investors include Tiger Global Management and mutual fund manager Fidelity Investments.
From: Vaping Post