A day after US marched against gun violence, country's oldest gun maker files for bankruptcy
Just a day after the US saw 'March For Our Lives' protests against gun violence which has killed several in the country over the years, Remington - the USA's oldest gun manufacturer - has sought Chapter 11 bankruptcy protection.
After being in business for 202 years, the filing by the Remington Arms Company and its parent Remington Outdoors was revealed on Sunday night on the website of the US Bankruptcy Court in Delaware. The details of the filing were not known immediately but the company had on Friday, March 24, informed to its investors about a negative operating cash flow of $7.4 million as of Sunday, March 25.
Trump's US saw a slump in gun sale
Remington Outdoors, which owns gun manufacturers like Bushmaster and Marlin, said the sales in 2017 were down by 30 per cent since 2016, standing at just over $600 million. Gun manufacturers in the US have seen a sharp decline in their sales following the 2016 presidential election which brought Donald Trump to power.
The reasoning is that people found less urgency in stockpiling firearms under his gun-friendly regime and the industry has been hit by what is being described as a "Trump slump".
Remington's problems have been worsened by factors like heavy debt and product liability involving its signature product Model 700 bolt-action rifle which was probed by the media in 2010.
In February, Remington said that the bankruptcy would be pre-packaged under a settlement with the lenders and it was not clear when the firm is hopeful about emerging from the shadow of bankruptcy.
Private equity firm Cerberus, which started to buy gun firms a decade earlier, owns Remington and soon after the media probe of 2010, it abandoned the plans for an initial public offering of what was then called the Freedom Group.
Cerberus even revealed its plan to drop the gun business following the 2012 massacre at Sandy Hook Elementary School in Connecticut but did not find any buyer.