Sep 26, 2019

Tobacco giants Altria and Philip Morris ditch merger plans


Altria (NYSE: MO) and Philip Morris International (NYSE: PM) said they are no longer in talks for an all-stock merger, which would have reunited the two cigarette makers after more than a decade apart.

Why it matters: It reflects tobacco industry tumult over the Trump administration's proposal to ban flavored vaping products, although the two companies still plan to launch a joint, FDA-approved, "heat-not-burn" vaping product called IQOS.

The bottom line: The deal's death raises new questions about if either company will make a distressed takeover play for Juul, whose newly-installed CEO K.C. Crosthwaite previously led IQOS for Altria (which already holds a 35% Juul stake).

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Altria's stock rises despite Kroger, Walgreens e-cigarette bans

Photo: Igor Golovniov/SOPA Images/LightRocket/Getty Image

Kroger and Walgreens announced they will stop selling e-cigarettes amid rising deaths and illnesses linked to vaping, becoming the latest retailers to do so after Walmart and Rite Aid stopped sales earlier this year.

Why it matters: Despite the bad news for vaping, Juul maker Altria's stock rose on Monday as investors continued to bet its recently launched Iquos product will succeed where electronic cigarettes have failed.

Go deeperArrowOct 8, 2019

Court temporarily stalls New York ban on flavored e-cigarettes

A man smokes an e-cigarette in New York in 2017.  Photo: Jewel Samad/AFP/Getty Images

A state appellate court blocked New York's ban on all flavored electronic cigarettes the first week of October, preventing New York from becoming the second state to put such a ban in place, the Wall Street Journal reports.

The big picture: The Food and Drug Administration announced last month that it was finalizing plans to pull all flavored e-cigarette cartridges from the market. Massachusetts currently has the harshest vaping ban in U.S.

Go deeperArrowUpdated Oct 4, 2019

Obama officials vetoed FDA ban on flavored vaping products

Flavored vaping products containing nicotine. Photo: Robyn Beck/AFP/Getty Images

The Obama-era FDA tried to ban flavored vaping products in order to protect kids, but White House officials blocked the plan following aggressive lobbying from the vaping industry, according to hundreds of documents obtained by the LA Times.

Why it matters: The evidence suggesting that flavors could have a significant impact on youth vaping was essentially covered up.

Go deeperArrowOct 2, 2019