Remington: Gunmaker Files for Bankruptcy Amid School Shooting Protests


Financing to get that done totals $338 million, including a $193 million asset-based loan, a $100 million debtor-in-possession financing loan, and a $45 million "bridge" or "rescue" loan from Remington's parent company to its operating subsidiaries. "We will emerge from this process with a deleveraged balance sheet and ample liquidity, positioning Remington to compete more aggressively and to seize future growth opportunities". Industry analysts said consumers no longer feel the need to stockpile weapons under the threat of restrictive gun control measures. The gunman used a Remington assault rifle to gun down 20 students and six faculty members (a similar weapon was used in the Parkland shooting). It's owned by Cerberus Capital Management, which plans to shed ownership once the bankruptcy is complete.

BlackRock is a major shareholder in gunmakers Sturm Ruger, American Outdoor Brands, and Vista Outdoor Brands.

Remington generated $865.1 million in sales and $21.6 million in profit in Fiscal Year 2017, the last full year publicly reported, but owes approximately $958 million.

But legal experts said beyond stopping litigation against the company, the filing raises the question about what unsecured creditors, such as the families, could be awarded should they eventually win a judgment against Remington. "I wanna remain hopeful that the filing is what it says it is, an opportunity to restructure debt and hold off on some creditors while they continue to operate and re-organize".

Under the deal, $700 million of the total debt would be negated.

Remington Outdoor Brands has filed for bankruptcy.

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The bankruptcy filing comes as the firm faces a nosedive in sales - and calls for gun control spread in the wake of nationwide protests spurred by the Parkland, Florida school shooting.

Industry observers have dubbed the current downturn in sales the "Trump slump".

Cerberus Capital Management, which acquired the company in 2007 as gun sales began to boom, tried to sell it less than a week after the Sandy Hook shooting.

The Bushmaster AR-15 rifle was used in the Sandy Hook shooting in CT in which 20 first-graders and six educators were killed in 2012.

"I still think Remington's bankruptcy is not only reflective of the overall downturn in the firearms market over the past 16 months, but also the particular difficulty that producers of modern sporting rifles have been seeing during this same time", he added.