E-Cigarette Maker Juul Mulls Potential Bankruptcy

E-Cigarette Maker Juul Mulls Potential Bankruptcy
  • Juul Labs Inc, backed by Altria Group Inc MO, has been exploring various options—including bankruptcy—after the FDA issued its marketing denial order.
  • The e-cigarette manufacturer is in informal talks regarding debtor-in-possession financing, Bloomberg reported, citing people with knowledge of the preparations.
  • The preparations aren't final, and plans could change. The report further cited a spokesman for Juul that the company is still considering other avenues.
  • In September, Juul Labs filed a complaint accusing the FDA's refusal to disclose documents supporting its banning order on the company's products.
  • "We will continue the preparation process for both a restructuring and other strategic options as we determine what path is best for our company," the report quoted the spokesman. 
  • Juul hired bankruptcy advisers Kirkland & Ellis and Alvarez & Marsal in June after the FDA banned Juul products on U.S. shelves, citing a lack of evidence demonstrating their overall safety. 
  • Juul recently won a court order temporarily blocking the FDA decision, and the agency separately stayed its ban, allowing the company to continue selling products. 
  • RelatedFDA Temporarily Suspends Banning Order On Juul's E-Cigarettes
  • Price Action: MO shares are down 0.71% at $42.20 during the premarket session on the last check Wednesday.
  • Photo Via Wikimedia Commons

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