Oldest US Gun Maker Remington Files For Bankruptcy

Randall Padilla
March 27, 2018

The shooter, Adam Lanza, killed some 27 people, including his own mother, using Remington's Bushmaster XM15-E2S.

The firearms industry suffered another blow Sunday when, as expected, Remington Outdoor Co. filed for Chapter 11 protection in the U.S. Bankruptcy Court for the District of Delaware.

The iconic brand has a long and storied history as an economic anchor in the central NY community where it was founded, and as a critical arms supplier through several major wars.

The company has existed for more than 200 years. That weapon was a Smith & Wesson, made by a unit of American Outdoor Brands Corp.

"We do not expect this filing to affect the families' case in any material way", said one of the families' lawyers, Katie Mesner-Hage of Koskoff Koskoff & Beider, in a prepared statement. The Italian company Beretta has been making guns since 1526. The company has longstanding ties to upstate NY. That factory, which got its start producing thousands of guns for the Army, forms the economic foundation of Ilion and much of the surrounding Mohawk Valley.

The manufacturer, which began operation in 1816, when there were only 19 states, has offered lenders responsible for $550 million of debt an 82 per cent stake in its business. It returned to its role as military arms supplier during the two World Wars.

While Remington was cleared of wrongdoing, the protracted legal battle caused many investors to divest from the company.

"Everyone thought Hillary was going to win", Dionisio said.

Remington plans to reduce its total debt of over 950 million US dollars and to confirm its bankruptcy plan by May 3.

Cerberus Capital Management LP, the private equity firm that controls Remington, will lose ownership in the bankruptcy.

Concerns about rising gun violence, mass shootings and accidents have prompted litigation, some of it including Remington.

But the slump is more of a market correction, according to Brian Rafn, a gun industry analyst with Morgan-Dempsey Capital Management, LLC, who pointed out that the surge of gun sales during Barack Obama's presidency was bound to "come back down to earth". Industry analysts said consumers no longer feel the need to stockpile weapons under the threat of restrictive gun control measures.

This is just the latest blow for a company whose sales have been declining for years, leaving them with between $100 million and $500 million in debt.

Other reports by AllAboutTopnews

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