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

by
posted on November 21, 2019
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

TRW163 Lexington Common,
TRW163 Lexington Common,

The Men & Guns Of Lexington Green

On April 19, 1775, 250 years ago, approximately 80 armed militiamen from Lexington gathered on their village green to confront several hundred British infantrymen. The events of that morning began a conflict that would ultimately establish the United States of America.

"Battle Road" & The British Retreat To Boston: 250 Years Later

After the fights at Lexington and Concord's North Bridge, the British column had to return to Boston. On its way, the regulars were set upon by hundreds, then thousands, of armed militiamen hell bent on revenge.

Preview: Hawke Airmax 2-7X 32 mm AO

Shooters looking to add optics to their air rifles should choose airgun-specific scopes such as those in Hawke’s Airmax line—which offers four models.

The Shot Heard Round The World: The Arms & Events Of April 19, 1775

April 2025 marks 250 years since the momentous events at Lexington and Concord—the opening salvos of the American Revolution. Today, exhaustive research of primary accounts and surviving firearms and artifacts give us a clearer picture of what really happened.

Gun Of The Week: Browning Citori 825 Field

Learn about Browning's latest version of the famed Citori shotgun, the Citori 825 Field, in this week’s range video.

The Armed Citizen® April 18, 2025

Read today's "The Armed Citizen" entry for real stories of law-abiding citizens, past and present, who used their firearms to save lives.

Interests



Get the best of American Rifleman delivered to your inbox.