22nd Century Group, the Clarence-based cigarette maker, has purchased all of the equipment at a bankrupt North Carolina cigarette manufacturer’s factory.
22nd Century, which to this point has used contract manufacturers to produce its cigarettes, bought the equipment in a Mocksville, N.C., cigarette factory for $3.22 million and has agreed to lease the 61,500-square-foot manufacturing plant that was used by Alternative Brands to produce its own line of cigarettes until August. Alternative Brands had been operating in bankruptcy since 2009.
The purchase is expected to speed up 22nd Century’s efforts to start making its own cigarettes by at least six months, said Joseph Pandolfino, the company’s chief executive officer.
The company, which uses proprietary technology that allows it to manipulate the levels of nicotine and other chemicals in tobacco, plans to start production within the next month of its Spectrum brand of research cigarettes, which can have the same amount of tar as conventional cigarettes but nicotine levels that vary from very low to very high. Production of the company’s Red Sun and Magic super-premium cigarette brands is expected to begin shortly after that, Pandolfini said.
The company said it will not need about a third of the equipment it purchased and will try to sell it.
22nd Century also said it expects to sign a manufacturing agreement with a strategic partner and begin exporting its cigarettes later next year.
The company in September paid $3 million to acquire another North Carolina company, NASCO Products, and related cigarette-manufacturing machinery in a deal that gave the Clarence firm its own federally licensed tobacco manufacturer and made it a participating member of the 1998 Tobacco Master Settlement Agreement between the tobacco industry and 46 states.