Remington preparing to file bankruptcy

[cuzinbruce]

News has it that Remington is preparing to file for bankruptcy. Here is a link:

https://www.reuters.com/article/us-r...-idUSKBN1FT04C

Trying to arrange financing to operate as "debtor in possession". Should be able to continue in operation but things could get shaky. Here are the brands effected (from their website):

"we have some of the most globally recognized brands including Remington, Bushmaster Firearms, DPMS/Panther Arms, Marlin, H&R, The Parker Gun, Tapco, Advanced Armament Corp., Dakota Arms, Nesika, Stormlake, Timbersmith and Barnes Bullets"

[john.k]

Sounds like the executives are trying to figure out a scheme where they keep their salaries and bonuses.Whats wrong with a good old Ch 11......anyway,whoever heard of having to borrow millions just so they could go broke?...its one of the few things they can do if they dont have any money......or a $billion in debt with $1/2 billion in repayments in the next two years.......yeah,I dont understand finance.

[buckshotshoey]

As far as I'm concerned, they did it to themselves. I said this was coming in one if the Marlin threads. And that's the saddest part. They are taking the Marlin name down with them.

Oh, wait a minute, now that i think about it, it is President Trumps fault.

That is a joke, but might not be to far from the truth. Obama was the biggest gun saleman in US history.

[dverna]

I have seen it happen before. A company is unable to grow its market and buys up other companies often paying a premium for them. If the executives are compensated based on sales or profit, bad things can happen and often do. The real strength of a company is measured in cash flow. That is what the Board of Directors, and owners of the company need to constantly look at. The holding company knows that full well.

I do not see them making it as they are currently structured. Some brands may be sold off if they are generating cash and/or have a name in the industry. Marlin may be one of them. The AR companies have a good name but AR's are being made by a lot of people and there is nothing special there.

[HangFireW8]

If Cerberus had been smart, they would have let Remington go bankrupt before acquisition, given the huge liability of continuing Remington 700 trigger settlements. A "new" Remington (in name only, with IP acquired) could say "sorry, not us" to every older product liability lawsuit after that point.

Look at GM. By legally screwing over retirees, parts suppliers, and shareholders in bankruptcy, they came out with a new lease on life and much lower overhead per vehicle produced.

[cuzinbruce]

I believe this would be Chapter 11, re-organization. Chapter 7 would be liquidation, send in an auctioneer. Now they have to get the original lenders to agree to take some percentage of the loan value. And lose the balance.
Sales were down 27% on one of the sites writing about it. So that kills their cash flow. And then there is no way to make the loan payments.
Same thing happened to Colt a few years ago.
The best items will probably continue. The slow items may be dropped. Quality and customer service may head south too. If they haven't already.

[FergusonTO35]

Hasn't Remmy gone bankrupt a few times already? It's practically a family tradition at Colt.

[Bigslug]

I've been trying to get my finger on the pulse of where the industry is going - Remington is no small part of that puzzling.

It seems that a lot of guns are being made for entry-level shooters who haven't really learned guns yet. In the case of Remington:

The 700. The quality on this one seems to have remained consistent through it's tenure. There's a lot of good things you can do with one, but the fact remains that it made its splash by being a cheap (and admittedly effective) hunting rifle option compared to some of the sexier offerings of the early '60's. There's the mechanical concerns that many knowledgeable folks either shy away from, or immediately gut the fire control out of.

The 870. Like the 700, it started as a cost effective option and was REALLY effective at that. Now the commercial guns have gone down the path of "if cheap is good, cheaper must be better". The aluminum trigger guard is now plastic, the barrel/magazine spring retention system is no longer fully interchangeable with the old system of parts, and the sandblast blue will rust if you look at it sideways. To get a "good" 870 made like the original, cost-effective gun, you have to buy a $600+ Police model.

The AR-15. To me, it's a tool for a specific niche, and I don't feel any need to pimp out, branch out into a zillion other calibers, etc... Like I said in my intro, it seems like a lot of "GEE WHIZ!" for less experienced shooters.

The 710/783. I really don't know the 783 all that well, but the 710 was the poster child for everything wrong that I just described with the 870. Best I can tell, they were trying to make a Savage without the talented engineering. I can't really fathom anyone walking into a gun shop, looking at the plethora of older, better made, used guns available, and choosing one of these.

Meanwhile, most of my recent shopping seems to be directed at the 1870-1950 period (or at least the engineering derived from then) when it was more broadly understood that a life might depend on this lump of metal. Maybe this old-for-his-generation Gen-Xer has different shopping values than the millenials, but I simply don't get a lot of what the industry is turning out. In the context of this thread, Remington is loosing my market share to guns they and others made 30+ years ago. When your old product is better, and doesn't wear out, that might be a real problem.

[nagantguy]

Just from the r51 nightmare people should have seen this coming, tons into advertising non into r and d to see if the platform was able to withstand going from 380-9mm. And if just half the new marlin horror stories are true. Well than you have a company who's abandoned former glory,left its loyal costumers behind and can no longer turn a buck

[HangFireW8]

Bigslug,

If you are trying to get a finger on the pulse of the industry, consider that Cerebus companies are run differently than sane ones.

The Cerebus pattern as I've seen it is:
1. Buy a distressed company with a big name, on the cheap.
2. Do a small investment in "R&D" (and I use the term loosely) to come up with some flashy "new" (and I use the term loosely) products, buying-in to, and co-opting whatever market trends are at the moment.
3. Release "new" products with great fanfare and BS about investing in America.
4. Sell off any real assets, rent everything, so when it goes bust there's nothing to collect on.
5. Squeeze, squeeze, squeeze everything for maximum short-term profit, ruining the brand value for another generation
6. Sell it once it starts to lose money

When this procedure gets to 5.) at an economic downturn, 6 comes quickly. Look at their previous ownership of Chrysler.

[nagantguy]

Bigslug,

If you are trying to get a finger on the pulse of the industry, consider that Cerebus companies are run differently than sane ones.

The Cerebus pattern as I've seen it is:
1. Buy a distressed company with a big name, on the cheap.
2. Do a small investment in "R&D" (and I use the term loosely) to come up with some flashy "new" (and I use the term loosely) products, buying-in to, and co-opting whatever market trends are at the moment.
3. Release "new" products with great fanfare and BS about investing in America.
4. Sell off any real assets, rent everything, so when it goes bust there's nothing to collect on.
5. Squeeze, squeeze, squeeze everything for maximum short-term profit, ruining the brand value for another generation
6. Sell it once it starts to lose money

When this procedure gets to 5.) at an economic downturn, 6 comes quickly. Look at their previous ownership of Chrysler.

I believe you have it correct, they have a track record of operation just as you e listed above.

[Cosmic_Charlie]

With the huge surge in firearms ownership the last decade they really screwed up.

[Earlwb]

I think that the gun market started or became saturated during the end of the Obama reign. The media had everyone believing that Hillary was going to win. So everyone who wanted a gun, extra guns or considered even owning a gun went out and bought them. So by the time Trump was the surprise winner, pretty much everyone had what they wanted. Plus with Trump as the winner suddenly it wasn't very imported to go out and buy more guns, etc. Thus the gun sales suddenly fell off the cliff. Those companies not prepared for the sales drop were caught with the pants down. These companies were borrowing money furiously as they were expecting sales to continue or increase even. Actually quite a few gun stores ran afoul of it too and went out of business.

[Jack Stanley]

Sorry to see them go , perhaps the company will get sold to somebody who can repair the damage done by the carpetbaggers .

Jack

[Livin_cincy]

I suspect that they banked on $20 per (50) round box of 9mm rounds lasting for ever. Now you find factory 9mm rounds for half of that.

The Remington line of Handguns are being sold as maritime ballast. The Remington name was devalued.

We hear Marlin is back on track but field reports are not so good on the rumor.

So if the brands are sold off they need some polish to remove the tarnish.

[CLAYPOOL]

We bought them for my business. RP - 9's. They have had 4 rounds of discounts, ETC. We currently have 2 different rebait's working. Even if the re-baits fall threw, they were bought at a very good dealer price.. Shoot as good as the rest.

[FergusonTO35]

The only place I've seen the RP pistols are big box stores like Rural King and Cabela's. And I would imagine it took one heckuva bargain for those stores to put them under the glass. I have yet to see them show up at any real gun shops, in fact the only Remington handguns they ever carry are the 1911's.

[root]

^^^^^ THIS^^^^
And the R1911 doesn't even take mil spect 1911 parts.

Ya Cerebus does seem to have a pattern when the buy a company.

Seems they have the midas touch but instead of turning to gold, it turns things to the brown smelly stuff.

Rich

[Smoke4320]

^^^^^ THIS^^^^
And the R1911 doesn't even take mil spect 1911 parts.

Ya Cerebus does seem to have a pattern when the buy a company.

Seems they have the midas touch but instead of turning to gold, it turns things to the brown smelly stuff.

Rich

I believe that's the tidy bowl touch

[Jeff Michel]

Spoke with a distributor's sales man yesterday, they are filing under Chapter 11. Currently this distributor does not carry Remington or Marlin products but are planning to start carrying their product line in April. Just re-organization.