Firearms maker Remington Arms Co. has filed for bankruptcy protection a second time since 2018, burdened by more debt than it can pay, even as fearful Americans buy more guns than ever.
Remington, which supplies weapons for hunting, shooting sports, law enforcement, and the military, sought Chapter 11 protection and will try to sell its business at a time when civil unrest and personal safety concerns have led to arms sales. of fire at record levels.
The Chapter 11 petition at the United States Bankruptcy Court in Decatur, Alabama marks Remington’s second restructuring since 2018, when he filed for Chapter 11 and transferred the property to investors, including Franklin Resources Inc. and JPMorgan Chase & Co.
THESE STATES SELL MOST OF THE WEAPONS IN THE UNITED STATES
Remington has been searching for potential buyers and was in talks to sell off bankruptcy to the Navajo Nation before negotiations collapsed in recent weeks, leaving the company without a leading bidder or stalking horse.
The manufacturer’s firearms and ammunition businesses could be sold separately, according to a person familiar with the matter.
SALES OF WEAPONS INCREASE 145% IN JUNE BETWEEN PROTESTS, CORONAVIRUS PANDEMIC
Despite losing approximately $ 775 million in debt in 2018, the company has struggled with high interest costs and has faced litigation related to the 2012 Sandy Hook Elementary School massacre, in which the killer used a Bushmaster rifle manufactured by Remington.
Meanwhile, gun control activists have lobbied investors and retailers to reconsider their ties to the firearms industry, particularly after the 2018 school shooting in Parkland, Florida.
AMERICAN REGISTRATION NUMBER TRY TO BUY WEAPONS
The fortune of the industry tends to increase and decrease according to the political climate of the country. Under former President Obama, firearm sales increased as enthusiasts worried about possible regulations. Sales softened after President Trump took office promising to defend gun rights.
The lawsuit has soared again since March, as measured by background checks by the Federal Bureau of Investigation, a proxy for sales. Background checks in June for civilians seeking licenses to carry guns were the highest since the FBI began conducting them 20 years ago.
The gun stores, which largely remained open during the Covid-19 pandemic, are selling to many first-time buyers worried about personal safety by the civil unrest that followed the murder of George Floyd in police custody and the ensuing movement to reduce police funds.
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While many types of retail inventory have plummeted in value during the pandemic, such as clothing, fashion accessories, and footwear, firearms hold up relatively well, according to valuation and liquidation experts.
But buoyant over-the-counter sales don’t immediately flow to manufacturers like Remington, which is rooted in 1816 and manufactures firearms at the Ilion, NY, and Huntsville, Alabama facilities. Some firearm companies also face supply chain problems that have been exacerbated. due to the pandemic, making it difficult to increase production to meet growing demand.
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–Alexander Gladstone and Julie Wernau contributed to this article.
Write Andrew Scurria at [email protected]