Tobacco giant Ochia Group said Thursday it has cut its investment in e-cigarette company Juul by $4.5 billion, or about a third. At the end of last year, Ochia invested $12.8 billion in a 35 percent stake in Juul, valuing the e-cigarette start-up at $38 billion. Ochia points out that there is no single event or factor that causes its writedown. It cites the Trump administration’s plan to remove flavored e-cigarettes from the market, as well as the ban on e-cigarettes being implemented in some cities, states and countries.
Juul has been in dispute for nearly a year. The company has been accused of contributing significantly to the prevalence of e-cigarettes among the teen population.
Juul has also been the subject of numerous lawsuits alleging that the company misled minors and made them addicted to nicotine, while the federal government investigated the company’s marketing practices. A former Juul executive filed an wrongful dismissal lawsuit Tuesday, saying the company’s pursuit of profits outweighed public health concerns.
Recently, a mysterious lung disease linked to e-cigarettes in the United States, consumers began to question the safety of e-cigarettes.
Now, the Trump administration is preparing a plan that officials say will remove all flavored e-cigarettes from the market until the FDA reviews and approves their public sale. Juul announced earlier this month that it would stop selling most flavored e-cigarettes.
K.C., a senior executive at Ochia, said: “I’m not s. Croswaite replaced Kevin Burns as Juul’s chief executive last month. Crosvitz is reshuffling top management, laying off workers and trying to repair Juul’s image.