#Bankruptcy

What is happening at Colt? That’s the question on many people’s minds as news of layoffs in the company began to trickle out starting on Tuesday. Rumors of massive layoffs at Colt began with a post at Pistol-Forum by member “misanthropist”, who wrote:

Gander Mountain is a privately owned company and normally they do not make public statements of any kind. Amidst a multitude of speculation that they were going bankrupt they finally broke their silence.

An ammunition company has evidently closed its doors: HPR Ammunition, a subsidiary of Advanced Tactical Armament Concepts, LLC, reportedly shut down in mid-September, according to local news outlet Payson Roundup:

Manufacturer of the Vector submachine gun, and parent company to Sphinx System AG, makers of high-end CZ 75 handgun derivative, may be in financial trouble. At the end of 2015, Sphinx System AG was declared bankrupt; now its parent company may be in danger as well due to court-ordered restructuring. From DWJ.de:

Sciens Capital Management, the hedge fund managers that own Colt Defense, LLC, have failed to meet the January 8 deadline for funding the famous gunmaker’s exit from bakruptcy. The Wall Street Journal reports:

Colt’s exit from bankruptcy has hit a snag: The owners of the company, Sciens Capital Management have defaulted on a $15 million funding commitment to Colt Defense LLC, as part of the company’s exit from bankruptcy. The private equity company agreed to pay the money to help Colt meet its commitments to its lenders, but failed to actually provide the money within the deadline.  Nasdaq.com reports:

Hartford, Connecticut gunmaker Colt has won confirmation of its Chapter 11 bankruptcy exit plan. The plan, which includes a new lease on the company’s Hartford plant as well as negotiated terms for retiree medical benefits with the United Auto Worker’s union, was approved by all of the company’s stakeholders.  ABLAdvisor reports:

In a recent article on Guns.com shows an outlined plan for Colt Defense to get itself out of the current financial quagmire that it finds itself in these days. And no, it doesn’t involve a Native American Casino company as was proposed earlier this year in an attempt to save the company. The current plan is to completely restructure the financial landscape of the company in addition to consolidating debt, both of which I have neither the financial education or knowledge to explain in eloquent terms. The important part is that the plan was approved by a federal judge, but still has to be voted on by the stock holders. However I think the most important part is that it doesn’t include firing any of the 700 employees that Colt currently employs, always a good thing for the job market. Personally I feel that Colt has more often than not, been a reactive firearms company as opposed to the more proactive firearms companies in coming out with new designs and adapting to the market. By this I’m referring to such companies as Winchester, Remington, Ruger, and other large companies that have constantly changed their designs and introduced new ones. Whereas Colt has largely depended on their government contracts and their production of previous successful designs to keep them afloat. In addition to all Colt AR parts being Mil Spec to begin with, because they are the original. We reported on this plan in September this year, but the difference now is that the plan was approved by a judge.

According to a recent article by business news outlet Reuters, Colt Defense may be close to a deal to bring the company through its ongoing bankruptcy. The success of this plan is critical to the survival of Colt in its current financial hands, as the alternative is that the company will be sold off. From Reuters:

In a bizarre twist to the Colt bankruptcy story, the Morongo Band of Mission Indians has stepped into give the famous gun manufacturer a helping hand. The Wall Street Journal reports:

The end we knew would come has finally begun. Colt Defense, LLC is set to file chapter 11 bankruptcy protection tomorrow, according to insider sources, reports marketwatch.com:

The news stories about Colt’s have been piling up recently. I admit I am not as well-versed in financial-ese as I could be, which has made me hesitant to cover the subject. It’s a good thing, then, that Hognose of WeaponsMan has covered the ongoing saga of financial flailings better than I could have: