Credit & Capital

Remington Files for Chapter 11

It is the 200-year-old gunmaker’s second filing since 2018.
Remington Files for Chapter 11

Remington Arms, the U.S. gunmaker founded in 1816, has filed for Chapter 11 protection in the U.S. Bankruptcy Court of the Northern District of Alabama.

The company listed assets and liabilities both in the range of $100 million to $500 million. Remington said it had $437.5 million in sales in 2019, about half what it earned in 2016.

It is the second time in just over two years that Remington has filed for Chapter 11 protection. In March 2018, the company filed for Chapter 11 protection and announced it was seeking to reduce its debt by $620 million.

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Cerberus Capital Management acquired Remington in 2007 and accumulated nearly $1 billion in debt. It emerged from its 2018 bankruptcy having reduced its debt by more than $775 million. Ownership was transferred to senior lenders.

Firearms dealers have reported a sharp increase in sales in recent weeks as protests spread in the wake of the death of George Floyd, but the company said it was unable to capitalize on the increase in firearms demand because the COVID-19 pandemic had disrupted its manufacturing.

The company had been in discussions over a possible sale to the Navajo Nation; however, The Wall Street Journal, citing a person with knowledge of the situation, reported that those discussions had broken down.

Remington’s products include the Bushmaster AR-15-style rifle that was used in the 2012 mass shooting at the Sandy Hook Elementary School in Newtown, Connecticut. In November 2019, the U.S. Supreme Court declined to hear an appeal by Remington over a lawsuit brought by families of the victims, who are seeking to hold Remington partly responsible by targeting the company’s marketing strategy.

That case is scheduled for 2021.

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