Mighty Corp, the country’s second largest tobacco company, and British American Tobacco (BAT) have held exploratory talks on a distribution partnership, Reuters reported.

Mighty Corp Executive Vice President Oscar Barrientos described the talks as in a “very preliminary stage,” Reuters said. Speculation about the financial health of Mighty surfaced on reports that federal authorities were investigating the tobacco company for massive tax evasion. Barrientos was cited by Reuters as saying authorities have not filed a case against the company.