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Altria Group Inc. (MO - Get Report) , the maker of Marlboro cigarettes, confirmed Thursday, Dec. 20, it was investing $12.8 billion in Juul Labs Inc., valuing the e-cigarette startup at $38 billion.

Altria's investment represents a 35% stake in JUUL.

"We are taking significant action to prepare for a future where adult smokers overwhelmingly choose non-combustible products over cigarettes by investing $12.8 billion in JUUL, a world leader in switching adult smokers," said Howard Willard, Altria's chairman and CEO, in a press release. "We have long said that providing adult smokers with superior, satisfying products with the potential to reduce harm is the best way to achieve tobacco harm reduction. Through JUUL, we are making the biggest investment in our history toward that goal."

The deal values Juul at more than double the roughly $16 billion valuation it received in July in a private funding round, according to Reuters.

Juul's vaping devices have helped it become the market leader in the U.S. e-cigarette business, holding a market share of 75% from just 13.6% in early 2017, Reuters reported, citing a Wells Fargo analysis of Nielsen retail data.

According to The Wall Street Journal, Altria's injection of $12.8 billion of capital into Juul would vault the company into the top ranks of privately owned firms, more valuable than Airbnb, Pinterest and Elon Musk's SpaceX.

Altria shares fell 4% on Thursday to $49.36. 

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