Remington just filed for Chapter 11...again.
American is experiencing a surge in firearms sales like none ever seen before in the face of the coronavirus pandemic, but even that was not enough to pull Remington Arms out of another huge financial hole. Fox News reports that the old and historic gunmaker has field for chapter 11 bankruptcy for the second time in the past two years.
The filing was made in U.S Bankruptcy Court in Decatur, Alabama this week.
Remington last filed for bankruptcy in April of 2018 when faced with over $700 million of debt. That initial bankruptcy was probably due to a huge slump in gun sales that started back in 2016 with the beginning of the Trump administration.
This time around however, Fox News reports that high interest costs coupled with a high profile and costly lawsuit by the families of victims of the Sandy Hook Elementary school shooting are likely partially to blame. USA Today further reports that in this latest filing, the company's liabilities and listed assets total somewhere between $100 million to $500 million. Not many other details about the filing were initially available, but Fox News notes that Remington has been searching for a buyer recently. According to their reports, Navajo Nation was in talks to buy, but the deal ended up falling through.
When Remington filed for bankruptcy in 2018, the company went through a huge restructuring process that included appointing a new board of directors. Now the firearm and ammo portion of the business may be sold in a separate deal that was not elaborated upon.
The news of this famous gunmaker's financial trouble comes less than a week after the National Shooting Sports Foundation released updated numbers on gun sales in the first half of 2020. Concerns and civil unrest relating to the pandemic have helped lead to one of the largest surges in firearms sales ever seen. Retailers have reported a whopping 95 percent increase in firearms sales and a 139 percent increase in ammo sales.
The same report also noted that the different demographics of buyers have seen their largest sales surges in decades. If Remington does make another comeback, now would be the time to do it. It is concerning for the storied gun manufacturer. News Channel 2 in New York reports that one of the company's large facilities in Ilion, New York may close because of this filing, prompting concerns over a loss of jobs in the community.
We will keep an eye on this story as it continues to develop and we will bring up updates if and when Remington finds a new buyer.