Cerberus Capital Management Buys Remington Arms Company

[Fred Fuller]

An affiliate of Cerberus bought Bushmaster in 2006 also. ( http://www.bushmaster.com/documents/news/bushmaster_continues_to_grow_.asp )

lpl/nc
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http://www.wktv.com/news/local/6883912.html

Remington Arms Sold (Updated 10:14am)
Joseph Gross, Remington Arms Plant Manager, has confirmed that Remington Arms has been sold.

Remington Arms Company, Inc. is the only manufacturer of both firearms and ammunition for Hunting, Law Enforcement/Security, Government & Military applications in the United States. They have announced that it will be acquired by an affiliate of Cerberus Capital Management, L.P. as part of a definitive agreement between Cerberus and RACI Holding, Inc. for an estimated value of $370 million.

Tommy Millner, CEO of Remington said, "This transaction is an acknowledgment of the Remington tradition, its strong brand, and the excellent products built over 191 years through innovation and by our dedicated employees. Further, this new partnership signals our intent to continue the path of enhancing our production capabilities and product offerings, in order to further grow our presence domestically and internationally.

The company expects the transaction to close in June 2007.

 

[MD_Willington]

Cerberus Capital Management

Here's a wiki on them... yep boo his a wiki.. LOL

http://en.wikipedia.org/wiki/Cerberus_Capital_Management

 

[30 cal slob]

What is it with all these financial buyers buying gun companies?

I wonder if the next Remington/Cerbaloosa 700 I see will come equipped with a Delphi sound system installed in the stock.

-slob

Remington to Be Bought by Cerberus for $118 Million (Update4)

By Danielle Kost

April 5 (Bloomberg) -- Remington Arms Co., the gunmaker that has equipped U.S. soldiers for 150 years, agreed to be acquired by private-equity firm Cerberus Capital Management LP for $118 million.

The company, based in Madison, North Carolina, produced its first profit in three years in 2006 after struggling with rising materials costs and increased competition from Smith & Wesson Holding Corp., maker of the .44 Magnum popularized in the ``Dirty Harry'' movies. Remington was sold by New York-based private-equity firms Bruckmann, Rosser, Sherrill & Co. and Clayton Dubilier & Rice Co., according to a company statement.

Remington was founded in 1816 by Eliphalet Remington II, who built his flintlock rifle in Ilion Gulch, New York, after placing second in a shooting match and attracting the attention of other contestants. The company was rescued by the U.S. government after Russian revolutionaries defaulted on a contract in 1918 and benefited from its purchase during the Great Depression by DuPont Co., which made improvements to gun powder.

Cerberus is ``getting a brand that has leadership in the rifle market,'' said Cai Von Rumohr, a Boston-based analyst at Cowen & Co. who follows Smith & Wesson.

Winchester Rifles

Von Rumohr said Remington may be able to gain market share after U.S. Repeating Arms Co., which licenses the Winchester brand, discontinued three models and closed a factory in New Haven, Connecticut, where the rifles and shotguns were made for a century and a half.

The Remington transaction includes $252 million of debt. Cerberus spokeswoman JJ Rissi declined to comment on the deal's financial breakdown.

Remington, led by Chief Executive Officer Thomas Millner, stopped making handguns in the 1990s. Stricter federal and state laws governing the sale of pistols prompted gun manufacturers to narrow their focus on shotguns and rifles used for hunting and target shooting. The company's guns include the $812 700 BDL Custom Deluxe and $996 11-87 SPS Super Magnum.

In December, Smith & Wesson agreed to buy Thompson/Center Arms Inc. for $102 million to enter the hunting-rifle market. Springfield, Massachusetts-based Smith & Wesson, whose revenue is about half that of Remington, is known for its revolvers and pistols.

$300,000 Profit

Last year, Remington posted net income of $300,000 after three years of losses. Sales rose 8.7 percent to $446 million. Smith & Wesson last month said it anticipates earning $12 million on $225 million of sales in fiscal 2007. The company had 2,150 employees at the end of February.

Bruckmann, Rosser, Sherrill owns 61.3 percent of Remington, and Clayton Dubilier & Rice holds 13 percent and controls 26.6 percent of the voting power.

Clayton Dubilier bought Remington's assets from DuPont in 1993 for $300 million. The Wilmington, Delaware-based chemical company purchased a 60 percent stake in the gunmaker in 1933 and acquired the remaining shares in 1980. During its 191-year history, Remington branched out to produce typewriters, sewing machines and cash registers, businesses it later divested.

Remington expects to complete the transaction by June 28. Credit Suisse Group advised New York-based Cerberus, which manages $23.5 billion.

To contact the reporter on this story: Danielle Kost in Boston at [email protected] .

Last Updated: April 5, 2007 12:36 EDT

 

[ilbob]

I am glad to see Remington bought by a company that will no doubt focus on making products that gun buyers actually want to buy.

Too many gun companies have been bought by people who want to make a particular gun because they think it is a neat gun, but not enough buyers are willing to actually purchase them to make the company financially viable.