CNN and the New York Times are reporting that Remington has filed for bankruptcy protection for the second time in two years. The news outlets indicate the Chapter 11 paperwork was officially submitted to court in Decatur, AL.
The news doesn’t come as a surprise. The Wall Street Journal reported late last month that Remington “…is preparing to file for chapter 11 bankruptcy protection for the second time since 2018 and is in advanced talks for potential bankruptcy sale to the Navajo Nation…” The information was provided by an undisclosed source close to the development.
According to todays New York Times story, though, “Remington has been in search of potential buyers and had been in talks with Navajo Nation to acquire it out of bankruptcy, but the negotiations collapsed in recent weeks, leaving the company without a bidder as it goes through reorganization.”
Remington is one of the nation’s most storied firearm manufacturers and is more than 200 years old. It was acquired in 2007 by Cerebus—a private-equity investment group—and added to its stable of firearm-related companies that ultimately grew to include legends in the industry. Then in March 2018 Remington filed its first Chapter 11 bankruptcy protection request. Its books were nearly $1 billion in the red. It emerged quickly, in May 2018, after reaching an agreement with creditors that ultimately removed Cerebus from management.
One of the first signals of its latest financial challenges surfaced last year, when Remington lost $3 million in incentives that Alabama provided to convince the company to move manufacturing to the state. According to AL.com, the decision was made because the company, “…failed to meet hiring and payroll targets at its Huntsville plant…”
The Navajo Nation made a $475 to $525 million offer to purchase Remington during the first bankruptcy proceeding, according to the New York Times. Company officials indicated they weren’t entertaining outside offers at the time, although the Indian Tribe’s long-term plans may’ve played a bigger role—stopping production of AR-15s for civilian sales, concentration on military and police sales where contracts often dictate minority-owned-business preference and investment of profits into development of “smart guns.” Production would also move to the Southwest.
Meanwhile, business is flourishing over at Ruger.