NEW YORK: Juul Labs Inc is in talks with two of its investors about a bailout that could help it avoid a bankruptcy filing, the Wall Street Journal reported on Monday, citing people familiar with the matter.
Hyatt Hotels heir Nick Pritzker and California investor Riaz Valani are considering putting up money to cover the e-cigarette maker’s operations and near-term legal liabilities, the report said.
According to the report, the bailout would help Juul stay in business and resolve a dispute with federal regulators over whether its products could remain on the US market.
The US Food and Drug Administration (FDA) in June banned the sale of Juul’s e-cigarettes in a major blow to the once high-flying firm whose products have been tied to a surge in teenage vaping. The FDA order was later temporarily stayed.
In a statement to the WSJ, Juul said it continues to explore several strategic options to secure its business and address the impact of the FDA’s stay order “as we fight to preserve our mission of transitioning adult smokers away from cigarettes while combating underage use.”
In July, Juul said it was in the early stages of exploring several options, including financing alternatives. — Reuters
