Capital Reinsurance has recently bought Juul shares on the secondary market for more than $300 a share, nearing a $50 billion valuation
Following its $1.2 million investment in overseas markets, Juul Labs had launched its small flash drive-sized vaping device in the United Kingdom in July 2018. At the time, Juul Labs’ president for Europe, the Middle East and Africa, Grant Winterton had pointed out that Britain was Juul’s third market after the United States and Israel, partly because it boasts the world’s “most supportive government” since it endorses e-cigs as harm reduction tools.
Meanwhile, a recent article on the New York Post has pointed out that Juul is aiming to raise as much as $10 billion in cash. The source noted that Juul isn’t looking to sell the new stake to fund growth, but rather to generate a massive dividend for existing investors. “Europe and Asia will drive significant growth,” said a source who advises Juul investors. “They are only reaching out to sovereign funds and big-money investors.”
Reportedly Capital Reinsurance, a unit of the hedge fund Capital Group, has recently bought Juul shares on the secondary market for more than $300 a share, nearing a $50 billion valuation. Apparently, the seller of those shares was Fidelity Investments, an early Juul investor. “Fidelity has made a killing in this,” a source said, adding that Fidelity is now largely out of its Juul investment.
Challenges due to EU limits
In the meantime, Juul Labs faces some challenges in Europe as the roll-out of the Juul device across EU countries, has been hampered by limits of 20 milligrams of nicotine per millimetre of liquid, compared to 59 in the United States. The San Francisco-based manufacturer says that this makes their product less effective as an alternative to cigarettes for heavy smokers.