E-cigarette maker Juul’s value slashed to $24 billion by hedge fund investor, WSJ says

Health, Fitness & Food

A person smokes a Juul Labs e-cigarette in this arranged photograph taken in the Brooklyn, New York.

Gabby Jones | Bloomberg | Getty Images

A hedge fund that owns equity in Juul Labs reportedly slashed the value of its stake by more than a third to a price that values the e-cigarette maker at $24 billion.

Darsana Capital Partners recently wrote down the value of its investment in the embroiled c-cigarette maker, the Wall Street Journal reported Friday, hinting at the toll heightened regulatory hurdles are taking on its business.

Darsana is one of a number of hedge funds that saw big gains in its Juul investment last year following its deal with global tobacco company Altria. A representative for Darsana couldn’t be reached for comment.

Sales of e-cigarettes including Juul prodcuts have slowed over the past four weeks between scrutiny from regulators, a string of negative headlines and a growing number of vaping-related illnesses.

E-cigarette sales volume rose 38.1% in the four-week period ended Sep. 21, compared with 48.1% growth in the 12-week period, according to Nielsen. Sales for products made by Juul Labs grew just 31.2%, a slowdown from its 56.2% growth for the 12-week period.

The latest report comes after people familiar with Juul’s value in the private market told CNBC in September that its value is “coming down sharply.”

While Altria invested in the controversial vaping company at around $250 per share and this summer that value rose to a high of about $300 per share, sources say that Juul is now valued at 20% lower in a range between $225-$230.

Click here for the original Wall Street Journal report.

— CNBC’s Jasmine Wu contributed reporting.

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