Remington Outdoors (Formerly Freedom Group) Offers Investors A Way Out

By Robert Farago

“Having failed so far to find a buyer, the $20 billion investment firm, Cerberus Capital Management, essentially will let its investors sell their stakes in the company, Remington Outdoor, formerly the Freedom Group, and move the manufacturer out of its funds and into a special financial vehicle,” nytimes.com reports, haltingly. Did you catch that “essentially” bit? Here’s the catch . . .

 

In its decision to cash out investors, Cerberus has all but acknowledged that it must hold on to its investment for a while longer. In the letter, which was reviewed by The New York Times, the private equity firm said that it would take Remington out of its main private equity funds and put it into a separate financial entity.

Cerberus will then let its investors sell their individual stakes in the gun maker back to the company.

At a price determined by Cerberus, not the free market, and not specified by the Times. Given Remington Outdoors’ disastrous brand management (e.g., driving a Six Sigma spike through once-proud Marlin brand and turfing out AAC’s brain trust), you’ve got to think the price is less than the amount tendered. A lot less. So who’d take that kind of hit?

Investors …read more

Source:: Truth About Guns