Posted on 04/06/2007 5:02:18 PM PDT by neverdem
Remington Arms Co., the N.C. gunmaker that has equipped U.S. soldiers for 150 years, agreed to be acquired by a New York equity firm Cerberus Capital Management LP for $118 million.
The company 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.
Cerberus is entering the $2.1 billion U.S. firearms industry, whose sales grew an annual average of 28 percent from 1998 to 2005, according to the U.S. Treasury Department. Remington is the country's largest and oldest maker of rifles and shotguns.
Remington was sold by other New York-based private-equity firms Bruckmann, Rosser, Sherrill & Co. and Clayton Dubilier & Rice Co., according to a company statement Thursday. The company is based in Madison, 25 miles north of Greensboro.
Remington was founded in 1816 by Eliphalet Remington II, who built his flintlock rifle in Ilion Gulch, N.Y., 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.
Cai Von Rumohr, a Boston-based analyst at Cowen & Co., 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, Conn., 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, Mass.-based Smith & Wesson, whose revenue is about half that of Remington, is known for its revolvers and pistols.
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.
Clayton Dubilier bought Remington's assets from DuPont in 1993 for $300 million. The Wilmington, Del.-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.
Very nice!
You are fast!
1024x768
I had already cropped it a bunch to tighten it up and remove the large movie title in lower right corner
Lol, I’m fast - even with a slowed down computer today!! Shows up well now anyway, it would be dusk for them.
Sent you the url already.
Maybe they’ll reintroduce customer service.
The Remington of the past decade or so, how shall we say? SUhuhuhuhucccccccccckeddddddddddddddd!
The 870 is the best-selling pump shotgun in U.S. history.
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H&R 1871/NEF is a subsidiary of Marlin.
You’re absolutely right . My bad [as the young folks say]. My apologies.
Remington ammunition is made by DuPont. Just as Winchester is made by Olin. At one time Dupont and Olin each owned the firearms company by those names, but neither does so now.
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