RALEIGH, N.C. — U.S. Tobacco Cooperative Inc., a grower-owned marketing cooperative, announced on July 7 that it filed for bankruptcy.
The Raleigh, N.C.-based company said it filed for Chapter 11 protection in federal court to meet short-term contractual obligations to member growers during crop season 2021.
“This filing provides us the best way possible to meet our short-term obligations and plan for the future,” said Oscar House, CEO and president of U.S. Tobacco Cooperative. “In no way does this action reflect on the health of the organization and its ability to continue operations well into the future. In fact, this action is in response to the uncertainty presented by the ongoing class action litigation brought against us in 2005. Rest assured that our obligations to our member-growers, employees, suppliers and customers have always been and will continue to be our highest priority and concern.”
With the filing, U.S. Tobacco Cooperative intends to satisfy obligations to its more than 550 member growers and more than 200 employees. The filing will allow the company to reorganize and restructure to honor commitments to stakeholders and ensure the organization’s sustainable future, it said.
U.S. Tobacco Cooperative processes U.S. flue-cured tobacco that’s grown by its members in Florida, Georgia, South Carolina, North Carolina and Virginia. The tobacco is processed and sold as raw materials to cigarette manufacturers worldwide. Subsidiaries of U.S. Tobacco Cooperative include U.S. FlueCured Tobacco Growers (USFC), Premier Manufacturing, Franchise Wholesale (doing business as Wildhorse Distributing), Big South Distribution and King Maker Marketing Inc.