Agriculture biotechnology firm 22nd Century Group announced a registered direct offering of shares to raise expected gross proceeds of $35 million.
The offering to institutional investors will sell more than 17 million 22nd Century shares for $2.05 per share and issue warrants exercisable to purchase 17 million more shares at the same price for five years, 22nd Century said in a news release.
Buffalo, New York-based 22nd Century acquired hemp-derived cannabinoids company GVB Biopharma in May.
At the time, 22nd Century said GVB had “an estimated 15% share of the hemp-derived active ingredients market.”
However, proceeds from the new share offering will not be used to fund GVB or to repay its debt, according to the release.
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Instead, the proceeds will be used “for expansion and acceleration of the launch” of 22nd Century’s reduced-nicotine cigarettes, among other purposes.
Shares of 22nd Century trade as XXII on the Nasdaq exchange.
