Cerberus Capital Management informed investors May 15 that it had found a way to let them divest their holdings in Remington Outdoor Company Inc. even though it has been unable to find a buyer for the gun maker, according to a report by The New York Times.
Cerberus came under pressure from pension funds and other institutional investors to divest the gun maker after a gunman was accused of using a Remington Bushmaster rifle and other firearms to gun down 26 children and adults at an elementary school in Sandy Hook, CT.
After two years of searching for a buyer, Cerberus opted to separate the business from one of its funds so investors could divest from the company, according to The New York Times article.
Firearms makers have been struggling since firearms sales peaked leading up to the presidential election on fears that a second-term Obama Administration would restrict the sale and/or ownership of certain firearms, such as modern sporting rifles.
Last week, Colt Defense LLC disclosed that its bondholders had rejected an offer to exchange $250 million in unsecured debt for new junior secured bonds with a face value of $75 million, likely clearing the way for a Chapter 11 bankruptcy.
