Universal Corp. Forms Liquid Nicotine Joint Venture

Richmond, Va.-based Universal Corp. (NYSE: UVV  ) , the largest leaf tobacco supplier to the cigarette industry, announced this week that it is branching out into liquid nicotine production for electronic cigarettes.

The e-cigarette industry has enjoyed exponential growth in recent years, rising from sales equivalent to essentially zero traditional "analog" cigarettes annually in 2007, to the equivalent of 600 million analog cigarettes in 2012, to a projected 1.5 billion analog cigarettes replaced this year, according to an April report by Business Insider.com.

Looking to participate in this growth trend, Universal is partnering with botanical extraction company Avoca to form a joint venture that will be known as AmeriNic, Through this JV, Universal plans to produce liquid nicotine for use in e-cigarettes, with production beginning later this year. Pharmachem Laboratories, headquartered in New Jersey, is the parent company of Avoca.

Universal CEO George C. Freeman III explained: "We continually evaluate opportunities to meet the evolving needs of our customers and our industry. The electronic cigarette industry is developing rapidly, and as a leader in leaf tobacco sourcing and agronomic research, we are pleased to bring our expertise to this dynamic market."

Universal does not expect the formation of AmeriNic to affect its financial results this year.

link


Read/Post Comments (4) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On August 07, 2013, at 3:39 PM, chris736 wrote:

    I wouldn't buy ANYTHING that is even remotely tied to ANY big tobacco companies. They have had their share of the pie and then some. They should have been the first ones to make and sell ecigs. That was a safer alternative, though and big tobacco wouldn't want that! Their rushing to jump on the train now, though. Greedy scum of the Earth.

  • Report this Comment On August 07, 2013, at 3:41 PM, chris736 wrote:

    Anyone who partners with big tobacco will not get my business, PERIOD! That means you Avoca!

  • Report this Comment On August 07, 2013, at 4:14 PM, refuego2005 wrote:

    I would love to switch to e-cigs, but unfortunately I have an apparently rare allergy to citrus. Every brand of e-cig I've come across contains citric acid, I don't know why it's in there but I wish someone would make an e-cig without it. Universal are you listening?

  • Report this Comment On August 09, 2013, at 11:12 AM, DigitalVapor wrote:

    @ refuego2005 , Try a personal vaporizer, like an ego-c, then you can refill the tanks with whatever you want, there are thousands of flavors and nicotine levels to choose from, most without citrus and US made...

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2584298, ~/Articles/ArticleHandler.aspx, 9/16/2014 11:37:16 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement