Remington Outdoor, an American gun maker, has filed for Chapter 11 bankruptcy protection.
Remington is planning to use the Chapter 11 bankruptcy to restructure its debt. As such, the company is planning to continue normal operations while it goes through the bankruptcy.
The gun maker originally announced its plans for Chapter 11 bankruptcy protection back in February, but is only just now filing. It hopes that the process will allow it to reduce debt by $700 million.
Remington is also seeking to provide its subsidiaries with $145 million through the Chapter 11 bankruptcy protection. It will also be losing Cerberus Capital Management as an owner once it exits the bankruptcy, reports CNNMoney.
With Cerberus Capital Management dropping ownership of Remington, the company is planning to provide lenders with an ownership stake. The agreement announced last month includes giving this stake to lenders in exchange for reducing its debt of $945 million by $700 million.
According to the Chapter 11 bankruptcy filing, Remington still has between
$100 million and $500 million of debt. This matches the gun maker’s estimates for the total value of its assets.
Remington’s decision to enter Chapter 11 bankruptcy protection comes as the entire gun industry deals with slowing sales. This is likely due to President Donald Trump taking the White House. Customers probably aren’t as fearful of gun bans with a Republican in office, The New York Times notes.
The Chapter 11 bankruptcy filing was made by Remington on Sunday. The company filed for for Chapter 11 bankruptcy protection with the federal bankruptcy court in Delaware.
As of this writing, William White did not hold a position in any of the aforementioned securities.
