(Reuters) - Turning Point Brands TPB.N said on Friday it would explore options for its vaping distribution business amid intense regulatory scrutiny on the fast-growing industry.
The company, which has market capitalization of about $400 million, said the expected future returns from business may no longer justify the required investment in it going forward.
E-cigarette makers have been facing intense backlash globally following reports of vaping-linked lung injuries that have killed 37 and sickened more than 1,000 people in the United States.
Tobacco giant Altria Inc MO.N on Thursday took a $4.5 billion hit from its investment in embattled e-cigarette maker Juul Labs Inc.
Turning Point Brands sells products including rolling papers, chewing tobacco and vapes and owns e-cigarette distributors such as VaporBeast, Vapor Shark and Vapor Supply bought through acquisitions.
“Vaping headlines dramatically disrupted our third-party vaping distribution business starting in mid-August,” Chief Executive Officer Larry Wexler said in a statement.
Reporting by Soundarya J in Bengaluru; Editing by Arun Koyyur
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