Top US gunmaker Remington files for bankruptcy

Remington, one of nation's top gunmakers, files for bankruptcy

The bankruptcy of Remington marks a blow to the gun industry and the decline of one of America's oldest gun companies.

Leah Barkoukis at Townhall brings us the sad but predicted news that Remington Outdoor Company (better known to most of you shooters as Remington Arms) has filed for chapter 11 bankruptcy protection.

In sum, the plan is created to reduce approximately $700 million of Remington's debt and support the contribution of $145 million of new capital into Remington's operating subsidiaries, markedly strengthening the company's consolidated liquidity, balance sheet and long-term competitiveness.

But that only bought time for it to seek Chapter 11 bankruptcy protection. The company makes the AR-15 Bushmaster, the gun used in the Sandy Hook Elementary shooting where 20 children and 6 adults were gunned down.

Remington's parent company Cerberus Capital was shunned by investors after its Bushmaster gun was used in the 2012 attack and has now been forced to borrow $100 million to continue operations.

Remington and other gunmakers have suffered from slumping sales in the past year as fears of stricter gun laws have faded. Remington has also been sued by individuals claiming some guns are defective, and voluntarily recalled some of its models.

In court papers filed with the U.S. Bankruptcy Court in Wilmington and obtained by SGB Media, the company plans to exit bankruptcy proceedings as soon as May 3.

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As for Remington, the oldest gunmaker in the USA, it was done in by lackluster sales, heavy debt tied to a 2007 leveraged buyout and lawsuits filed in the wake of the Sandy Hook school shooting.

Remington may face unique challenges, but with firearms buyers feeling unenthusiastic and a burgeoning movement gathering steam to stem gun violence, its deterioration may well represent something larger.

Remington experienced a "significant decline in sales" over the a year ago when demand "ultimately did not materialise" after the company boosted output in 2016, Jackson said.

Remington is headquartered in North Carolina.

The filing comes after a February 14 shooting at a Parkland, Florida, high school that killed 17 and spurred an intense campaign for gun control by activists.

Remington, which has a company history dating back to 1816, saw sales decline by 27% in the first three quarters of 2017, Reuters reported, amounting to a $28 million operating loss. A survivor of that shooting, plus several relatives of victims, sued the company, but the lawsuit was dismissed by a CT judge.

All of this said, firearm background checks, a loose proxy for gun sales, have remained relatively stable in recent months.

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