Oldest U.S. gun maker, Remington, files for bankruptcy amid falling sales
Remington, the oldest firearms manufacturer in the United States, filed for bankruptcy protection Sunday, after months of declining gun sales and amid renewed protests against gun violence.
The company had seen a year’s worth of slumping sales and could not meet requirements from its lenders, Remington chief financial officer Stephen Jackson said in documents filed in the U.S. Bankruptcy Court for the District of Delaware, Reuters reported.
The filing was not entirely a surprise. The company had announced on Feb. 12 that it had reached a deal with creditors to write off about $700 million of its $950 million debt load. Though it was on its way to Chapter 11, Remington’s executives predicted the gun maker would persist “now and long into the future.”
“We have an outstanding collection of brands and products, the unqualified support of a vibrant community across the industry, and a deep and powerful culture,” Remington CEO Anthony Acitelli said at the time. “We will emerge from this process ... to compete more aggressively and to seize future growth opportunities.”
However, two days later, a young man opened fire at Marjory Stoneman Douglas High School in Parkland, Fla., killing 17 students and staff members. The shooting — already one of several to take place at a school in 2018 — reignited the debate over gun violence and galvanized a new generation of activists, including many teenagers from Parkland.
Remington’s bankruptcy filing came just one day after hundreds of thousands of people gathered to protest gun violence at the March for Our Lives in Washington, as well as at hundreds of “sibling marches” across the country.
In the bankruptcy, Cerberus Capital Management, a private equity firm that acquired Remington in 2007, will lose its ownership of the company. Meanwhile, Remington’s creditors will exchange their debt holdings for equity, according to Reuters.
Remington’s woes reflect a sharp change in the gun industry over the past year. Firearm purchases soared during the run-up to the 2016 election: Hillary Clinton was favoured to win, and an array of gun-rights advocates warned of a looming Second Amendment crackdown. Earlier that year, President Barack Obama had stoked similar fears by proposing to expand federal background checks.
Donald Trump’s upset win over Clinton seemed to help reverse all that. Fears of a crackdown have tapered off under Trump, who called himself a “true friend” of the National Rifle Association.
Gun sales have declined. Reuters reported that Remington’s sales crashed in 2017, leaving it with a $28 million operating loss. Credit ratings agencies attributed the decline in part to “receding fears that guns will become more heavily regulated.”
Though Trump briefly hinted that he might take a stricter stance on gun rights after the Parkland tragedy — even chiding senators for being “afraid of the NRA” — the president toned down his push for more aggressive gun control after meeting privately with NRA officials. Trump has since doubled down on a proposal to help arm schoolteachers.
The NRA did not immediately respond to a request for comment Monday morning on the Remington bankruptcy.
Remington’s reputation has also flagged in recent years. The company fell under intense criticism after the 2012 shooting in Newtown, Conn., in which Adam Lanza used a Remington Bushmaster AR-15 rifle to massacre children and staff at Sandy Hook Elementary. A lawsuit seeking to hold Remington partially liable is pending before the Connecticut Supreme Court.