NY times article about why Remington went bankrupt

t never touched on the fact that quality went so far down hill that nobody wanted to buy their guns

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Remington's quality issues and poor management started decades ago. They spent untold millions paying off lawsuits and lawyers going back to the 1950's due to defective firearms. That is what put them in a position where they were no longer able to be innovative and produce new quality products. Once they became vulnerable it created the opening for them to be bought out by Cerberus who finished off the company to make a profit. Remington was circling the drain before the buyout. They just finished the job.

In the history of the Country I don’t think any company that was bought out by a capital firm has ever made it out alive. They don’t call them “corporate raiders” for nothing.

History, tradition, quality, people. None of these matter when it’s all about $$$.

I have always loved Remington shotguns, and I always will.

Stay safe.

Oh, lots and lots of companies have been bought by PE’s and done well thereafter. The times when the PE guys tank the company get all the press.

They aren’t gone yet.

Actually I am amazed by the quality, performance and value of the RM380s. In fact I even bought two of them, the only example I have ever bought two of.

Well, that's not quite true, I do own two S&W Centennials but one is a modern Airweight and the other an early Lemon Squeezer.

Interesting, the article mentions how the firm that bought Remington had Remington assume debt that paid the purchase cost back to the Cerberus, the private equity firm purchaser.

So, while Remington went bankrupt for various reasons, i.e., loss of panic sales due to a Republican president gaining office, the heavy debt it incurred, poor quality products, etc, the private equity firm walked away with no loss.

Speedo66 said:

Interesting, the article mentions how the firm that bought Remington had Remington assume debt that paid the purchase cost back to the Cerberus, the private equity firm purchaser.

So, while Remington went bankrupt for various reasons, i.e., loss of panic sales due to a Republican president gaining office, the heavy debt it incurred, poor quality products, etc, the private equity firm walked away with no loss.

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Yup. That’s the whole idea.

*Cough cough* Freedom Group

Remington was a very “mature” company - management set in it’s ways, labor set in it’s ways, the business culture then stagnates and becomes vulnerable to the changing outside forces. As the dinosaur said, “Dinosaurs have been here forever, why should we change?”

Speedo66 said:

Interesting, the article mentions how the firm that bought Remington had Remington assume debt that paid the purchase cost back to the Cerberus, the private equity firm purchaser.

So, while Remington went bankrupt for various reasons, i.e., loss of panic sales due to a Republican president gaining office, the heavy debt it incurred, poor quality products, etc, the private equity firm walked away with no loss.

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That's a routine thing. Even a company that's in a rut still has value. The key to "corporate raiding" is how to extract that value without any risk. Risk is for suckers who actually expect to turn a profit by, you know, building something. Buying a company someone else spent his/her life creating then having that company take out a loan and transferring that money to the new owner of the company is a way to eliminate the risk. After that, any money the acquired company makes is gravy. And if the loan and associated costs make the company go under, well, its pieces will fetch something. It's all pure profit. Meanwhile, thousands of people lose their jobs, the economies of entire towns or regions is wrecked, etc.

ATLDave said:

Oh, lots and lots of companies have been bought by PE’s and done well thereafter. The times when the PE guys tank the company get all the press.

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This guy gets it. There are lots of successful companies owned by private equity - it's really widespread and common.

Yep, Cerberus also trashed Chrysler.