Survivability of Remington ???

[260remingtom]

I feel sorry for the workers ,will they get paid out if the company does fold ?? and it's not just remington ! will marlin go as well ?, before they were bought out they made some really high quality rifles.

 

[CanardNoir]

I personally am not a fan of Remington products but respect what they mean to the industry and sporting world with past history. I think the quality and attention to detail has fallen off the face of the earth. I remember being a kid and in love with the 870 Wingmaster. Fast forward 30 years, I am sitting in a gun shop trading a Browning Maxus visiting with some others and each person said get a Browning, Beretta or Winchester but don't touch the VersaMax. My brother bought a 1911 that when he opened the box had to be returned to be fixed. Does Remington need to make an A/R, a 1911 and some other items they have moved into recently? It is great to have a large product line but also dangerous. When looking at the Rem 700, there hasn't been a single model come out that made me really think I want that gun. On the other hand, companies like Browning and Weatherby have both brought out products that I have a burning desire to buy. Savage and Ruger have done a good job as well.

I think we all remember the dark days of Colt and how they went from an icon to being nothing better than a paperweight. It seems they restructured and are producing products worth purchasing again.

The real downfall of Remington could very well be the expectations of private equity. They only want their return on their money. They aren't concerned with quality or customer service. I read something that referenced the lawsuits from Sandy Hook but that wasn't the real impact. It was the investors of Cerabus Capital pulling their money. Remember, Cerabus tried to dump the Freedom Group portfolio shortly after Sandy Hook and no one was a taker at that time.

Not sure there is any linkage but it is concerning that Freedom Group/Remington has acquired Dakota, Barnes, Bushmaster and others. When private equity creates a business like this, the impacts are far and wide. I don't know how these other entities roll up and if they are part of this pending bankruptcy. Just a thought to remember when supporting the big company vs small.

You are right on point.

Downside of a Chapter proceeding is: 1) How much capital is needed & which money center financial institution would risk the potentially-negative-PR + financial exposure?; and 2) Would a lender-in-possession proceeding really be a workable solution within the current marketplace, i.e. declining outdoor activity via license sales, combined with the higher costs associated with the sport-hunting experience?

Hence - I am not optimistic about the long-term outcome for the Remington brand, or its subsidiary holdings, because the George Soros-like mindsets are fundamentally against the arms makers' survival (i.e. George doesn't like the Second Amendment & just look what his financial thinking did to the recreational boating industry with his 1990s-Green Marine buy-sell maneuvering, just to be sure):

"Markets are constantly in a state of uncertainty and flux and money is made by discounting the obvious and betting on the unexpected." - GS

 

[CanardNoir]

It may be that the most valuable thing Remington will be left with is their brand though there may be more equity in other names like Colt. Perhaps potential investors suspected this was a likely outcome after Cerberus pulled their money allowing them to bide their time and be able to pick and choose for pennies on the dollar.

Brand names can be sold like cattle.

Remember Winchester? It's now just another Browning product.

 

[CanardNoir]

I feel sorry for the workers ,will they get paid out if the company does fold ?? and it's not just remington ! will marlin go as well ?, before they were bought out they made some really high quality rifles.

American Capitalism discounts the labor component of upward economic movement citing the "mobility of (employable) labor" - hence, they can always find another "job".

 

[CanardNoir]

That's very well said. My buddy worked at Remington for 2 years before he moved over to leupold. He said morale was very, very low. He said gun guys who loved the products and believed in them were getting beat down by management. He said the philosophy was quantity over quality.

And that (what you cited) is the "kiss of death" within American manufacturing - workers with no emotional connection to the product line = declining quality & subsequent sales. This ain't China or Japan!

Here's my case-on-point: Back during the 1960s-1980 I bought "new" three (3) new Remington rifles - 6.5mm Rem Mag 600; .22-250 Rem HV; .270 Win Classic. All three (3) were made MOA rifles in stock configuration with very little effort. And the 6.5mm actually shot sub-MOA routinely (87-gr BTHPs).

About three-years ago, I purchased a Rem 700 - 7mm STW through Gun Broker at the closeout price of $525 and it never got close to 2-MOAs with factory ammo. And that rifle never got close to even 2-MOAs with the X-trigger and all, despite the better scope and mounts of today. I sold that rifle last year along with 350-rds of factory ammo for $950 (roughly the worth of the 400-rds of brass + 3-12X scope).

So actual production quality may have actually been their weakest link for years - and now it's coming home to roost...

Moral: You get what you pay for, or a little-bit less.

 

[Deleted member 48126]

I just read in the Washington post Remington came to a deal with creditors to erase $700 million in debt. The other $300 million is up for legal review with the Delaware Supreme Court on who gets paid what and how.

 

[Deleted member 48126]

If I was a billionaire I would buy out Remington and clean house. I would significantly reduce their product line and make a couple of quality models in their go to configurations.

700
870
1100
Maybe keep one 1911 pistol model going
Do one AR15 and one AR10 platform

I would also do a huge push for the calibers that Remington has forgotten

6mm, .260, RUM resurrection, .350 Rem mag. Start producing brass and ammo again for them.

 

[CanardNoir]

I just read in the Washington post Remington came to a deal with creditors to erase $700 million in debt. The other $300 million is up for legal review with the Delaware Supreme Court on who gets paid what and how.

The "creditors" are those who have sold to, and/or perhaps loaned to Rem, in the past - both "secured" through a lien on the corporate assets; and "un-secured" types of creditors, members of a "creditors' committee" within the bankruptcy proceedings.

The Court may now determine how shall Rem proceed - as a "going concern" with continued production; or perhaps a "liquidation" of a soon-to-be shuttered corporate entity?

I'm sure there are some financial vultures sitting on the courthouse roof...

 

[azsugarbear]

There is a difference between being bankrupt and filing for bankruptcy. Remington has a couple large notes coming due later this year and early next year. Kind of like a balloon payment on your mortgage. If the bank refuses to renew your note, you have several choices: 1) renew the note with another financial institution; 2) sell the asset that serves as collateral for the note and hope the proceeds are enough to satisfy the debt; 3) file for Chapter 11 and try to restructure your debt with the help of the court (sometimes this includes a "cram down" which requires the lenders to write off part of their debt); 4) file Chapter 7 and liquidate everything.

Having been employed in the "work-out" divisions for several large banks in the past, I can tell you that it is not always one-sided. The banks sometimes lend more than they should because of greed, marketplace competition, etc. By the time they wake up and realize their loan is in trouble, there isn't much they can do. No other bank is willing to take them out at 100 cents on the dollar. They usually can't call the loan due because there hasn't yet been a default yet - even though they can see trouble ahead. The banks don't want to take a write-down of the loan amount as it could have a negative effect on the stock price at just the wrong time. Lots of moving parts here.

Having said all this, I agree with many on this thread. The decline in quality of their products, shortages of brass, lack of caliber support, etc. have long been signs to us shooters that there are big problems at Big Green. It has just taken time for the chickens to come home to roost. Remington will most likely survive, but what it will look like is anyone's guess.

 

[CanardNoir]

If I was a billionaire I would buy out Remington and clean house. I would significantly reduce their product line and make a couple of quality models in their go to configurations.

700
870
1100
Maybe keep one 1911 pistol model going
Do one AR15 and one AR10 platform

I would also do a huge push for the calibers that Remington has forgotten

6mm, .260, RUM resurrection, .350 Rem mag. Start producing brass and ammo again for them.

Rem did have an ammo-production facility at Lonoke, Ark., so I'd suspect that to be carved out of the bankruptcy proceedings if the company is liquidated.

Lead smelters are considered a toxic business by EPA, States, et al, and permits to operate as a going concern may bring a premium if sold. Remembering that Winchester purchased an old Emerson Electric facility in Mississippi which included a lead smelter...

 

[CanardNoir]

There is a difference between being bankrupt and filing for bankruptcy. Remington has a couple large notes coming due later this year and early next year. Kind of like a balloon payment on your mortgage. If the bank refuses to renew your note, you have several choices: 1) renew the note with another financial institution; 2) sell the asset that serves as collateral for the note and hope the proceeds are enough to satisfy the debt; 3) file for Chapter 11 and try to restructure your debt with the help of the court (sometimes this includes a "cram down" which requires the lenders to write off part of their debt); 4) file Chapter 7 and liquidate everything.

Having been employed in the "work-out" divisions for several large banks in the past, I can tell you that it is not always one-sided. The banks sometimes lend more than they should because of greed, marketplace competition, etc. By the time they wake up and realize their loan is in trouble, there isn't much they can do. No other bank is willing to take them out at 100 cents on the dollar. They usually can't call the loan due because there hasn't yet been a default yet - even though they can see trouble ahead. The banks don't want to take a write-down of the loan amount as it could have a negative effect on the stock price at just the wrong time. Lots of moving parts here.

Having said all this, I agree with many on this thread. The decline in quality of their products, shortages of brass, lack of caliber support, etc. have long been signs to us shooters that there are big problems at Big Green. It has just taken time for the chickens to come home to roost. Remington will most likely survive, but what it will look like is anyone's guess.

Never underestimate the powers of a bankruptcy court.

 

[WyoHunter1]

If they quit making models no one wants and design a decent trigger, put a synthetic stock on their rifles that are decent and just produce a decent barrel they could make a comeback without all the extra overhead.
Right now - you buy a Remington, replace the stock, trigger and barrel just to have a decent rifle. Still nothing special. All you really bought and used was the action.

 

[ssineden]

Wow! I have more compassion for the gunsmiths that try to fix their firearms after they leave the factory. They too will feel the impact.

Yet I have no compassion for Greedy self serving money grabbing idiots.

Who will build the high end US sniper rifles? I'm tired of paying thousands of tax dollars when there are other weapons out there that will do the job for half the cost.

I do wish the workers/builders/people well. I hope Remington can pull out of the decline but don't hold out much hope. The corporate lawyers have taken them to the edge. Bad triggers and bad luck may finish them off. Tradition is not always the best purchase.

 

[Mike 338]

I'm no Caption of Industry but when every third rifle that goes in a box needs to be sent back for function or fitment issues, should you really be surviving?