Altria Group Inc. announced on Monday that it would acquire the e-cigarette start-up NJOY Holdings Inc. for approximately $2.75 billion in cash, placing new bets on the rapidly expanding market after suffering enormous losses on its investment in Juul.

The tobacco giant announced that it had exchanged its investment in Juul for some of the heated tobacco company’s once-hot intellectual property. Juul is currently dealing with a backlog of lawsuits and is rumored to be getting ready to file for bankruptcy.

Altria invested $12.8 billion in Juul in 2018, but as of December of the previous year, the investment was only worth $250 million.

According to Altria, the NJOY agreement will also include an additional $500 million in cash payments that are contingent upon regulatory decisions regarding a few NJOY products.

NJOY is one of the few of of vaping businesses whose products have approval from federal regulators. It produces disposable e-cigarettes under the NJOY Daily brand and NJOY Ace Pods, the only pod-based e-vapor product currently with market authorizations from the U.S. Food and Drug Administration.

Altria claimed it had several funding options for the deal, including cash from a $2.7 billion contract it had last year for the IQOS Tobacco Heating System with Philip Morris International Inc (PM.N).

Within three years of the acquisition’s completion, Altria’s adjusted per-share profit is anticipated to increase. The business, which made no mention of when the deal would be finalized, also reiterated its forecast for a profit of $4.98 to $5.13 per share in 2023.

Altria’s financial advisors are Morgan Stanley and Perella Weinberg Partners LP.

(Adapted from CNBC.com)