PRYOR, Okla. -- Last week, discount cigarette and cigar manufacturer Xcaliber International announced plans to acquire Russell Springs, Ky.-based Tantus Tobacco. The deal was announced amid news that the U.S. Food and Drug Administration (FDA) would officially expand its authority to include cigars, pipe, hookah and electronic cigarettes.
According to the Xcaliber press release, these FDA “deeming” regulations were central to the acquisition: Xcaliber intends to purchase all Tantus Tobacco cigarette, cigar and pipe tobacco brands manufactured before the Feb. 15, 2007, predicate product date outlined in the deeming regulations. These brands will likely be grandfathered in (meaning they will not require a substantial equivalence or premarket tobacco application to stay on the market) and also will be able to serve as predicate products for any future products Xcaliber might launch.
Founded in 2001, Xcalilber’s current brand portfolio includes Echo, Edgefield and Exeter cigarettes, and Blue Grass filtered cigars, and a presence in more than 50,000 retail locations.
“As our production facility and manufacturing efficiency have grown, expanding our product portfolio is a natural progression for us,” said Xcaliber International CEO Derrick Taylor. “We also saw the FDA’s announcement on the horizon and knew we had to be proactive.”
The Tantus brands involved in the deal include 24/7, Mainstreet, Sport, Gsmoke, Berley, Berkley cigarettes, Red Buck and Richwood filtered cigars, and Bacco and Red Buck pipe tobacco. Xcaliber intends to move manufacturing to its 100,000-square-foot production facility in Oklahoma and leverage Tantus’ sales personnel to more than double Xcaliber’s current sales staff and expand reach into new markets.
“I’m thrilled to see Xcaliber take our established brands and extend them into new areas,” said Brian Cooper, Tantus’ founder and CEO. “Xcaliber will provide an opportunity for me to watch products the Tantus team created to grow and prosper. Clearly Tantus and Xcaliber have a great deal of synergy.”
Xcaliber said the manufacturing and sales transition plan should be completed by Aug. 1.