Embattled e-cigarette company Juul raises $700 million in debt, amid financial strain and regulatory pressure
- E-cigarette maker Juul has raised more than $700 million in debt to fund its operations as the company deals with growing regulatory and financial pressures.
- The embattled company has been the face of a vaping crisis sweeping the country, causing it to fight lawsuits, deal with regulatory scrutiny, and adapt its business while watching its valuation slide.
- The latest fundraising comes as investors like cigarette company Altria recorded heavy losses in their Juul investment and slashed their valuations of the company
- A Juul spokesperson told Business Insider that the company remains committed to combatting underage use of its products and had "refrained from lobbying the Administration on its draft flavor guidance," among other measures.
- Visit Business Insider's homepage for more stories.
E-cigarette maker Juul has raised more than $700 million in debt to fund its operations, Business Insider has learned. The news was first reported by the Wall Street Journal on Thursday.
The fundraising comes just one week after cigarette company Altria booked a $4 billion impairment charge on its Juul investment, almost a third of its original $12.8 billion investment in the company.
As a wave of vaping-related illnesses has swept the country, regulatory scrutiny has taken a toll on the company. Juul cut more than 650 jobs and announced plans to slash spending by $1 billion in November. It also pulled its most popular flavors from the US market and scaled back plans to expand internationally.
As it scrambles to deal with growing pressure from regulators, Juul has also watched its valuation tumble from $38 billion. And pressures on the company continue to mount. Juul is currently battling private lawsuits and faces close regulatory scrutiny. The FDA has also continued to crack down on vaping, issuing a ban against all flavored vaping pods in January.
A Juul spokesperson told Business Insider said that the company was committed to work with the government to combat underage use of vaping products and help adult smokers transition from using traditional cigarettes.
"As part of that process in the U.S., we are preparing comprehensive and scientifically rigorous Premarket Tobacco Product Applications, stopped the sale of flavored pods other than Tobacco and Menthol in November, halted our television, print and digital product advertising, implemented a $1 billion restructuring plan, refrained from lobbying the Administration on its draft flavor guidance and support the final policy," the spokesperson said.
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