NJOY Marks Fresh Start With Financial Restructuring

SCOTTSDALE, Ariz. — NJOY LLC has acquired the assets of NJOY Inc. as the former completes its financial restructuring.

In conjunction with this acquisition, NJOY completed a $35-million equity capital raise, and is now a well-capitalized entity with no debt and substantial liquidity, according to the company. The transaction took hold in February.

The majority of the total capital investment in NJOY LLC, to support the acquisition and to capitalize the company, came from lead investor Mudrick Capital Management.

"Today marks a fresh financial start for the NJOY brand," said Douglas Teitelbaum, chairman and CEO of NJOY LLC. "With the completion of this acquisition and capital raise, we now have ample liquidity and can focus on delivering for our customers. I am excited to have the full support of our equity owners."

Moving forward, the company said it is prepared to operate within the framework of the Food and Drug Administration's final deeming regulations, and has already begun the process of pursuing required premarket tobacco product authorizations.

After completing its restructuring, NJOY is now majority-owned by Mudrick Capital Management, an investment firm that specializes in corporate turnarounds, and Teitelbaum's Homewood Capital. 

Teitelbaum has previously led several turnarounds, including Barneys New York, The Planet Hollywood Resort and Casino Las Vegas, Telcove Inc., and Island One Int'l.

The United States Bankruptcy Court for the District of Delaware entered an order approving the transaction on Nov. 15. 

NJOY's legal advisor in connection with the restructuring has been Kirkland & Ellis LLP. Batuta Advisors LLC was the company's financial advisor for the restructuring. Mudrick Capital Management was represented by Neal, Gerber & Eisenberg LLP.

In September, NJOY Inc., a long-established player in the electronic cigarette segment, filed for Chapter 11 bankruptcy protection. The e-cigarette manufacturer cited the market performance of its second generation Kings disposable e-cigarette in 2013-2014 and costs associated with a subsequent relaunch of the NJOY brand, as CSNews Online previously reported.

Scottsdale-based NJOY LLC is an independent electronic nicotine delivery system company. Its products include the Daily disposable electronic cigarette, the Pre-Filled Tank (a closed-system vape tank), the Compact Battery convenience vaping system, the King disposable electronic cigarette, and other electronic nicotine delivery system products.