Fear & Loading: Tax-Free Dividend in American Outdoor Brands Split

by
posted on November 21, 2019
** When you buy products through the links on our site, we may earn a commission that supports NRA's mission to protect, preserve and defend the Second Amendment. **
aobc.jpg

American Outdoor Brands (AOB) announced that its Board of Directors has unanimously approved proceeding with a plan to spin-off its outdoor products and accessories business as a tax-free stock dividend to stockholders. The proposed transaction, which is expected to be completed in the second half of calendar 2020, would create two independent publicly traded companies: Smith & Wesson Brands, Inc. (which would encompass the firearm business) and American Outdoor Brands, Inc. (which would encompass the outdoor products and accessories business).

“There have been significant changes in the political climate as well as the economic, investing, and insurance markets since we embarked upon what we believe have been our very successful diversification efforts,” said Barry M. Monheit, AOB chairman of the board. “We believe that separating into two independent public companies will allow each company to better align its strategic objectives with its capital allocation priorities. We also believe that this action will give the investment community clearer insight into the value creation potential in each of these independent companies, ultimately driving enhanced stockholder value. From the standpoint of our stockholders, at the time of the spin-off, the AOBC stockholders will own 100 percent of each company, thereby maintaining their pre-spin interest in both companies, and will thereafter have the ability to make distinct investment decisions tailored to their particular investment profile.”

The company explained the purpose of the spin-off is to enable the management team of each firm to focus on its specific strategies, including (1) structuring its business to take advantage of growth opportunities in its specific markets; (2) tailoring its business operation and financial model to its specific long-term strategies; and, (3) aligning its external financial resources, such as stock, access to markets, credit, and insurance factors, with its particular type of business.

Based in Boone County, Mo., AOB will be a growth-oriented provider of outdoor products and accessories for rugged outdoor enthusiasts. James Debney will become CEO of the company upon successful completion of the spin-off.

Headquartered in Springfield, Mass., Smith & Wesson Brands will continue its iconic leadership in firearm design and manufacturing under the guidance of CEO Mark Smith, who is currently the president of the Manufacturing Services Division of AOB.

 

 

Latest

001 22Tuc Cover 01 Copy
001 22Tuc Cover 01 Copy

Review: Taurus 22TUC

Taurus USA's 22TUC is a little, polymer-framed .22 pocket pistol with a tip-up barrel design that, unlike many of the company's guns, is made entirely in the United States.

Korea Coast Guard Increases KelTec KSG Tactical Shotgun Inventory

KelTec recently announced that the Korea Coast Guard has ordered more KSG shotguns to join those already in service aboard the branch's patrol vessel fleet.

Rifleman Review: Mossberg 990 Aftershock

In 2025, Mossberg added to the non-NFA, shotshell-firing firearm category with its 990 Aftershock, which uses a semi-automatic operating mechanism while still maintaining a compact form factor.

Next-Gen Micro Red-Dot: The Steiner MPS 2.0

Steiner Optics has introduced the next-generation version of its Micro Pistol Sight, a red-dot optic that first hit the market in 2021.

Rifleman Interview: Banish Suppressors

The “Plinkapalooza” event in May saw a rimfire extravaganza, with hearing protection from Banish suppressors.

Hunting for the “Grail” Gun in the Modern Era

To really enjoy hunting for “that gun,” burn shoe leather instead of your mouse pad.

Interests



Get the best of American Rifleman delivered to your inbox.