Biotech company 22nd Century Group is selling off its hemp operations in a deal worth $2.25 million as part of an attempt to cut costs.
“Substantially all” of the company’s GVB Biopharma division is being sold to Specialty Acquisition Corp., a Nevada business “affiliated with current GVB employees,” 22nd Century said in a Monday news release.
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The purchase price includes $1 million in cash, and the buyer is issuing a 12%, $1.25 million promissory note.
“The company plans to use the proceeds from the sale to further deleverage its balance sheet,” 22nd Century said.
The Buffalo, New York-based company said it also will retain the right to recoup an unresolved insurance payout from a 2022 fire at a GVB manufacturing facility in Grass Valley, Oregon.
The facility is currently worth about $9 million, according to 22nd Century.
The deal is scheduled to close in December,
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