The financial challenges faced by Remington Outdoors are well known, but an announcement by the company yesterday that it was restructuring and filing for protection under Chapter 11, according to CNN, indicates “Cerberus [the firm’s current owner] will give up that ownership once restructuring is complete … .”
The Remington Outdoor press release explains it has reached a “… Restructuring Support Agreement (RSA) with creditors holding a majority of the FGI Operating Company, LLC (‘FGI OpCo’) Term Loans due in 2019 and 7.875% Senior Secured Notes due in 2020…The RSA provides for the reduction of approximately $700 million of Remington’s consolidated outstanding indebtedness and the contribution of $145 million of new capital into Remington’s operating subsidiaries, markedly strengthening the Company’s consolidated liquidity, balance sheet, and long-term competitiveness.”
“The balance sheet restructuring will be effectuated,” it explained, “through a pre-packaged joint plan of reorganization to be filed in the United States Bankruptcy Court for the District of Delaware in connection with the Company’s filing of voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code.”
The company isn’t the industry’s first to file for protection during reorganization. It is, however, America’s oldest gun maker, and that legacy didn’t escape the attention of Remington Executive Chairman Jim Geisler. “Since its founding over 200 years ago, Remington has been a uniquely American company and brand,” he said. “Our longevity is owed to generations of loyal customers and hard-working employees who met challenges and delivered results. Difficult industry conditions make today’s agreement prudent. I am confident this regrouping ensures that Remington will continue as both a strong company and an indelible part of our national heritage.”
“Remington’s business operations will continue to operate in the normal course and will not be disrupted by the restructuring process,” the press release stated. “Payments to trade partners, employee wages and other benefits, support for customers, and an ongoing high level of service to consumers will continue without interruption.”
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