22nd Century Group weighs selling tobacco business

The plant biotechnology company disclosed it is considering “strategic alternatives” for its tobacco assets, including business combinations, asset sales, licensing arrangements and alternative financing strategies.

This comes amid financial struggles and leadership turnover for the company headquartered at 500 Seneca St. in Larkinville. 

“We believe the current market capitalization of the company does not appropriately reflect the value of our assets or their long-term potential,” Nora Sullivan, chair of 22nd Century’s board, said in a statement. “After extensive discussion, our board has determined that the best way to maximize value for shareholders is to comprehensively evaluate the company’s strategic alternatives.”

Sullivan said the company hopes to “identify ways to monetize the value or more effectively expand the market reach of our tobacco portfolio.” That portfolio includes the company’s VLN line of low-nicotine products, which have become more widely available to customers after 7-Eleven began selling them at over 1,450 corporate stores in three states.

The company said there was no timeline for completing the review, and it doesn’t intend to disclose developments “unless and until its board of directors approves a specific transaction, concludes the review, or determines that further disclosure is appropriate or is required.”

22nd Century Group is working with investment bank TD Cowen on the review.

In addition to tobacco products, 22nd Century Group has made a push into CBD products, as well as hops.

22nd Century Group reported a $20.5 million loss in the second quarter. Its stock price has plummeted over the past several months, opening at $1.46 per share on Wednesday.

In July, the company made a change at CEO, naming John Miller as interim CEO. The company also launched a cost-cutting effort aimed at achieving $15 million in annualized…