Altria to buy e-cigarette maker NJOY for $2.75bn

Altria said on Monday that it has agreed to buy e-cigarette maker NJOY for $2.75bn in cash.

The deal terms include additional $500m in cash payments that are contingent upon regulatory outcomes with respect to certain NJOY products.

Altria chief executive Billy Gifford said: "We believe we can responsibly accelerate US adult smoker and competitive adult vaper adoption of NJOY ACE in ways that NJOY could not as a standalone company.

"We believe the strengths of our commercial resources can benefit adult tobacco consumers and expand competition. We are also excited to welcome NJOY's talented employees to Altria at closing."

Altria expects the acquisition to be accretive to cash flow within two years of closing and accretive to its adjusted diluted earnings per share within three years. It also estimates the return on invested capital for the deal to exceed its current weighted-average cost of capital within three to four years of closing.