Remington Arms Up For Auction as Early as September
In a memo to employees on Tuesday, the CEO of Remington Arms explained yesterday's bankruptcy filing and said the company will most likely go up for auction in September.
"We took today's action in order to maximize our opportunity to achieve a "going concern" sale of our business," said Ken D'Arcy, CEO of Remington Outdoor. "We intend to conduct a competitive bidding process for the sale of some or all of our assets pursuant to Section 363 of the Bankruptcy Code." A "going concern" sale means that the business is sold with everything needed to operate for one full year. It also means that Remington's current owners would continue to operate the business until the sale is final.
On Monday, America's oldest gunmaker filed a Chapter 11 petition in U.S. Bankruptcy Court in Alabama for the second time since 2018. The company filked Bankruptcy in March of that year and claimed a debt of nearly $1 (b) billion.
The news comes as an estimated one-third of Remington's workforce in Ilion was furloughed two weeks ago, even as a new spike in gun sales has been sparked by COVID-19 and racial equity demonstrations around the country. Employees say those who are working have been placed on the job to keep two production lines moving due to recent demand. Mandatory Saturday shifts were also recently implemented by the company to keep up with demand.
"Despite the historical strength of Remington's brands, we have had a significant decline in sales for approximately four years," said D'Arcy. He said that the company is in active conversations with parties interested in a "going concern" sale and expects to be accepting bids before the September sale.
One of those interested parties had been the Navajo Indian Nation, which planned to purchase the gun maker and eventually move the company to their reservation which holds more than 27,000 acres of land in New Mexico, Arizona, and Utah. The Navajos are one of the largest Native American tribes in the United States, and hold a $3.3 (b) billion investment trust. On July 14th, tribe government decided to cease their acquisition of Remington, although delegates close to the debate told local media that a possible deal is not completely out of the question.
D'Arcy thanked employees for their hard work and focus during what he called a "difficult process" and also thanked their "loyal customers, consumers and suppliers for their continued support through these changing times."
He said he expects the sale process to be completed within the next several months.
Remington Arms was founded by Eliphalet Remington II in Ilion, NY in 1816. A large plant still remains in the center of that Upstate New York village, and now houses a depleted workforce of about 650 people.