Source: twitter.com
Remington a gun maker since 1816 has over 3,500 employees and it is reported that they are about $1 billion in debt. In 2007 Cerberus Capital acquired the company, Cerberus announced that they are filing for Chapter 11 bankruptcy to allow them to keep operating while they work with the creditors to negotiate the debt.
Source: twitter.com
The company said that business decline since Trump took office although Trump is in support of gun ownership. When hillary was still in the running, there was the belief that the public may lose the ability to purchase firearms. This spurred gun sales and Remington ordered inventory to satisfy future demand.
Once Trump was elected and the threat of loss of the ability to purchase firearms disappeared so did the demand. The gun industry was left with a large inventory without buyers. Having the large inventory draining their cash flow and a diminished income stream, they are now caught in a liquidity crunch.
The company issued a statement in regards to the bankruptcy
"Holders of the gun maker's $550 million term loan will take an 82.5% equity stake in Remington while third lien note holders get 17.5% of the company and four year warrants for a 15% stake". In addition, creditors will provide a $100 million debtor in possession loan to finance operations.
Source: americanmilitarynews.com
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