One of the oldest manufacturers of guns in the United States, Remington, recently determined that it needed to take aggressive action in light of its financial situation. The company thus chose to file for Chapter 11 bankruptcy. Companies in Massachusetts that are facing financial struggles may also benefit from this type of bankruptcy filing.
Remington decided to file for bankruptcy due to its heavy debt and falling sales. In addition, the company anticipated having to deal with negative court rulings related to the Sandy Hook school massacre that took place in 2012. As part of its bankruptcy filing, the company outlined a restructuring plan that detailed how it would maintain its operations and keep paying salaries and benefits to employees. The company ultimately plans to relinquish control to its creditors.
This agreement would bring to an end Cerberus Capital Management’s controlling financial interest in the company. This private equity firm acquired Remington in 2007 for nearly $120 million. Cerberus decided to file for bankruptcy after making a failed attempt to sell Remington. Remington, which has been manufacturing handguns, shotguns and rifles since 1816, stated in its filing that both its liabilities and its assets totaled anywhere from $100 million to $500 million.
Businesses in Massachusetts and elsewhere sometimes find themselves in tricky financial situations due to factors that are beyond their control. For instance, perhaps customer demand for their products or services has plummeted due to changed in the economic or political landscape. Fortunately, these companies do not have to remain in dire financial straits. An attorney can help them to seek Chapter 11 bankruptcy protection and finally receive the financial relief they so desperately need.
Source: usatoday.com, “Remington: America’s oldest gun maker files for Chapter 11 bankruptcy“, Kim Hjelmgaard and Kevin McCoy, March 26, 2018