Altria Group Inc said on Thursday it would convert its non-voting shares in Juul Labs Inc to voting shares, days after the tobacco giant took another billion-dollar hit to its 35% stake in the e-cigarette maker.
The company said it does not intend to exercise its additional governance rights obtained upon conversion, including the right to elect directors to Juul’s board, pending the outcome of a U.S. Federal Trade Commission (FTC) litigation.
Altria also does not intend to vote its Juul shares other than as a passive investor during the lawsuit.
The FTC in April filed a complaint aimed at forcing Altria to sell its investment in Juul, citing competition concerns.
The Marlboro cigarette maker invested $12.8 billion in late-2018 for a minority stake in Juul through non-voting shares, with their conversion to voting shares linked to antitrust clearance.
Altria last month took a $2.6 billion hit to the investment, reducing the value of the stake to $1.6 billion.
Shares of Altria, down 20% this year, were marginally lower in premarket trading on Thursday.
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