DPMS acquired by Cerberus Capital affiliate

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Henry Bowman

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http://sev.prnewswire.com/aerospace-defense/20071213/NYTH10313122007-1.html

DPMS Prepares for Future Under New Ownership
Focus on developing innovative products and serving our customers
ST. CLOUD, Minn., Dec. 13 /PRNewswire/ -- DPMS, a leading supplier of AR15 based rifles, parts and accessories announced today that its assets have been acquired by an affiliate of Cerberus Capital Management, L.P.

Randy Luth, DPMS founder and President, remarked, "We were looking for a partner that could enhance our expertise in operations and further develop our sales and marketing capabilities. Cerberus is a partner that can help us in those areas and provide the financial and operational resources required to expand our business. We look forward to working with them. After starting this business 21 years ago, I couldn't be more excited about our prospects for the future, both in terms of the growth we believe we can achieve and the level of satisfaction and value we can provide to our customers."

In connection with the transaction, Mr. Luth will remain President of the newly formed DPMS Firearms, LLC and will continue to oversee the strategic and operational aspects of DPMS. Added Mr. Luth, "I would like to thank our employees, first and foremost. Their hard work, and the support of our dedicated customers, has brought us to where we are today. As we look forward, we see increased interest in our new calibers, based on the proven DPMS 'LR' rifle platform. With our technical expertise and the commitment of our new owners, we intend to broaden the breadth and depth of our rifle and accessories offerings to current and new markets. We will continue to provide not only great value to our loyal customers, but also the high level of customer service we are known for."

The March Group, a private investment banking firm based in Nashville, TN, acted as financial advisor to DPMS. Principal Brantley Kemp was responsible for managing the transaction and advising DPMS on its strategic alternatives.

About DPMS Firearms, LLC

Headquartered in St. Cloud, Minnesota, DPMS Firearms, LLC manufactures and distributes a complete line of AR15 based rifles and components, as well as rifle platforms in other calibers. DPMS systems are in use by law enforcement agencies, military personnel and civilians worldwide, including the U.S. Border Patrol, security agencies in Iraq, the Jordanian army, America's top competitive shooters and big game hunters.
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First Bushmaster, then Remington. Who's next?
 
a think Cerberus would be a little concerned about political risk when it comes to buying EBR companies that sell to civilians.
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On one hand I agree, but on the other I have to say that Cerberus is a huge company with a lot of clout on Wall St and, probably, Capital Hill. If they can bring operational expertise to the firm and streamline things between Bushmaster, Remington, and DPMS, they can probably realize some excellent economies of scale, thus increasing margins.

As for differentiation... Remington for hunting, Bushmaster for tactical, DPMS for target?

ETA: I wonder if they're exploring the possibility of competing against Colt and FN for .mil contracts.
 
ETA: I wonder if they're exploring the possibility of competing against Colt and FN for .mil contracts.

I was wondering the same thing......The combined resources of those entities would make for some great R&D......
 
Those are the same folks that bought Chrysler/Dodge. Maybe they will make a "DPMS" edition Dodge truck. Or maybe a free LR with the purchase of any Chrysler vehicle.

Brad
 
The combined resources of those entities would make for some great R&D......
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That's the beauty of it... if they want to supply M16s and M4s, they don't need to do any research or development. Just ensure they have proper input materials and that manufacturing and QC standards are up to snuff. No need to reinvent the wheel if they're producing an M16.

Now, if they want to get into that HK416, XCR, SCAR debacle, then they'd need some R&D.
 
i wonder if they'll do a big game edition of the LR-30S. it would complement the varmint rebadge-a-bushmaster they already have, nicely.
 
Bushmaster and DPMS now owned by Cerberus, what direction will they take these companies?
 
Ah Ha! So that is why Remington has an AR15 rifle under the Remington name. Makes sense to me. I own all three, Remington, Bushmaster and DPMS. I hope everything goes well for them.
 
I'm still not sure how I feel about all these good firearms companies being bought-out by one uber-corporation... Especially one named Cerberus...

In Greek mythology, Cerberus or Kerberos (Greek Κέρβερος, Kerberos, "demon of the pit") was the hound of Hades, a monstrous three-headed dog with a snake for a tail (sometimes said to have 50 or 100 heads) called a hellhound.
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Cerberus guarded the gate to Hades and ensured that spirits of the dead could enter, but none could exit (additionally, no living person was to come into Hades).
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(From the all-knowing Wiki: http://en.wikipedia.org/wiki/Cerberus)
 
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