Juul brand name vape cartridges are pictured for sale at a shop in Atlanta, Ga.
Elijah Nouvelage | Reuters
The Securities and Exchange Commission has introduced an investigation into Altria’s investment in e-cigarette start off-up Juul Labs, the Wall Road Journal claimed on Friday.
Regulators are analyzing no matter whether the tobacco company sufficiently disclosed to shareholders the dangers when it invested $12.8 billion for a 35% stake in Juul in 2018, sources told the Journal. Altria’s stake valued the commence-up at $38 billion.
Altria took a $4.1 billion impairment charge for its expenditure in Juul in January. The company stated the charge displays the growing legal fees against Juul and the expectation that the selection of lawsuits will only improve. Juul is getting sued by multiple states for its role in advertising and marketing vaping amid teens and children.
Juul and Altria have both equally responded to subpoenas from the SEC, sources instructed the Journal. The e-cigarette maker turned above files to the SEC that provided correspondence with Altria and financial projections that it gave to Altria prior to its final decision to devote in Juul, just one human being stated to the Journal.
When reached by CNBC, Altria declined to remark. Juul did not promptly respond to CNBC’s request for remark.
Browse a lot more about the investigation in the Journal’s report.