Cerberus Plans IPO for Freedom Group Companies (Remington, Bushmaster, Marlin, DPMS, H&R)
If you had purchased Ruger (RGR) or Smith & Wesson (SWHC) stock after the November election, you would have seen your investment grow almost three-fold. Ruger stock now trades at over $13.00 after hitting $4.52 last fall. If Remington, Bushmaster, Marlin and other Freedom Group companies “went public”, could they ride the coat-tails of Ruger and S&W, and succeed collectively as a publicly traded stock? Cerberus, a private holding company that controls the Freedom Group, apparently thinks so.
Cerberus Plans IPO for Remington and Freedom Group
A surge in gun sales has pushed the stock prices of major firearms manufacturers upwards. Will that trend continue? We can’t say. However, the money men at Cerberus Capital Management, which owns Remington, Bushmaster, Marlin, and other Freedom Group companies, have decided that the time is ripe to “go public” and start selling stock. According to a 10/19 report in the Wall Street Journal Blog, Cerberus plans an initial public offering (IPO) for its Freedom Group companies. The Freedom Group is comprised of Advanced Armament Corp., Bushmaster, Dakota Arms, DPMS, Eotac, H&R, L.C. Smith, NEF, Parker Gun, Remington Arms Company. Advanced Armament Corp. (AAC) is the latest addition to the Freedom Group collection, having been acquired just this month and placed under the Remington Military Products Division.
In its report on the pending Freedom Group IPO, the Wall Street Journal Blog cited AccurateShooter.com. When Cerberus acquired riflemaker DPMS in 2007, we wrote: “One positive aspect to Cerberus’ involvement in the gun industry is that the huge political clout Cerberus commands as the ‘rescuer’ of Chrysler Corp. should undermine efforts to ban AR-platform rifles. Cerberus is big enough to make waves in Washington. Money talks in politics and Cerberus has lots of it.”
Is the timing right for a gun-company IPO? The stock-market continues to move upward, and gun and ammunition sales remain very strong. On the other hand, the panic buying of black rifles has tapered off and AR-platform gun prices are now dropping back to “pre-panic” levels. Morever, at the end of each calendar year there are usually major stock sell-offs. That could drive down prices of Ruger and Smith & Wesson, which could dampen enthusiasm for a Freedom Group IPO. On the other hand Remington is an historic brand with a strong customer base, and Remington/Bushmaster are poised to take an increasing share of lucrative military contracts. With its new ACR (Adaptive Combat Rifle), Remington could well win the contract for the AR15’s replacement. And, even if the US military sticks with Stoner’s 50-year-old AR design, Bushmaster can fill that need, though it has strong competition from Colt and FN Herstal.
A cynical observer might say that Cerberus is simply looking to grab easy profits by “flipping” arms companies it acquired at fire-sale prices. Given the huge run-up in Ruger and S&W stock prices over the past 12 months, Cerberus may figure that investors will be hungry for Freedom Group shares. Right now may be the best time to take the Freedom Group public while gunmakers are still considered a “hot property” on Wall Street. In six months that could change.
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- DPMS Acquired By Cerberus. Joins Bushmaster and Remington.
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- Freedom Group Files for Public Offering This Year
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Tags: Bushmaster, Cerberus, IPO, Remington, Wall Street
Sure sign that gun acquisition fever is about over…. When the big boys decide to let the little guys buy into the dream it’s time to move on to the next asset class.
I think Jon is probably right on with his comment above. This event by Cerberus most likely spells woeful times for the firearms industry ahead. If they’re pulling out, there’s good reason.
Robert Whitley
It has been reported that the overall increase in the price of stocks is due to the devaluation of the US dollar. Basically it takes more dollars to purchase the same goods. I do not know if the Ruger and S & W stocks are on par with the remaining market or are outperforming the market????
What is the symbol going to be and when is it going to open?
Cerberus investors wanted to get 1/3 of their cash out as reported here previously. This is their way to do this and put it into other investmonts they may feel are safer in the future. Are these companies going to be profitable in the future or go back to companies in finacial trouble run by accountants? Robert Whitley hit it on the head. The money people know something about these investments we may not.
Not so fast – Cerberbus took TARP money earlier this year. Giving some control to the government. The feds during that time made privite offers to S&W and REM to buy stock fot controling ownership! The feds were turned down. When companies are public anyone can buy. Be careful what you wish for it may come true!
IT SOUNDS LIKE HILLARY CLINTON AND THE BAKER GROUP HAVER JUMPED IN BED WITH (SOROS) ….
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EDITOR: Enough Already with this Soros Nonsense!
George Soros does NOT own or control the Freedom Group or any of its subsidiaries. Got That?
We don’t know how this rumor started, but it is WRONG.
Repeat: Soros does NOT own or control the Freedom Group of Companies. And he does NOT own or control the Freedom Group parent, Cerberus Capital Management.
Source: Illinois State Rifle Association, http://www.isra.org/alerts/freedom_group/
Dear Editor, No, Soros does not own Freedom Group HOWEVER he does own Cerebrus [sic] does he not???
EDITOR: NO, NO, NO. Repeat NO!
Got it yet?
George Soros does not own or control Cerberus Capital management.
Reports that he does are completely, 100% WRONG!
Can we be any more clear about this?!
See: http://en.wikipedia.org/wiki/Cerberus_Capital_Management
See: http://www.snopes.com/politics/guns/freedom.asp
See: http://www.ammoland.com/2011/10/07/freedom-group-internet-rumor/
Some idiot bloggers have been linking to an older post from this site in connection with their bogus claim that Soros owns Cerberus. We NEVER, EVER wrote that, and we never even mentioned Soros.
NRA-ILA:Â Internet Rumors About Cerberus, Freedom Group Are Patently False
http://www.nraila.org/Legislation/Federal/Read.aspx?id=7136
In this day and age whose word can be trusted? Duplicity is as common place as a dollar bill, and those in authority have proven to be the biggest deceivers of all. How many times have we heard outright denials by those in power, only to come to see that it was a typical political or financial ploy of denial while dubious activities behind the scenes take place, which eventually ends up exploiting the people one way or another. Time will tell the truth of it all, for there is no doubt that the powers that be want gun control one way or another.
Enough with the [ Soros ] plot and Cerebus. It’s always some radical plotters. Sheesh!! What’s next? Our President is a Muslem extremist who would turn against the country he has sworn to defend?? Like that could happen.
For Dave, October 2009:
The value of stock has little to do with the declination of the US dollar. If you took a basic economics class you could learn this yourself. To save you the time, here it is in a nutshell:
The law of supply and demand states that if the demand for a particular good is high, but the supplies are limited, a rationing device has to be implemented. That rationing device is price. Sometimes, however, the supply is great; but demand is also great. This condition could be an indicator of the economic growth of a company (such as Ruger). The price of stocks for a successful publicly-traded company are on the rise due to the same factors. If 100 stocks are available, the price for a portion of ownership will also be high due to limited supply but high demand.
To reference what your dollar is worth you can research such topics as Consumer Price Index (CPI). For instance, the price for a gallon of gas has actually risen very little compared to 1980 when you factor in inflation. All of this information is readily available through the Bureau of Labor and Statistics and on the internet.
But I guess it would just be more fun to be a conspiracy theorist who bitches about the price of gas and the impending revocation of the 2nd Amendment.
Cerberus- Purchased Chrysler from Daimler, Cheapened all product lines. Nothing but problems…..warranty issues. Bankrupt!!!!
Purchased New Page Paper Rumford Maine. again nothing but cuts. This holding company thinks they can make money. Bankrupt!!!!
Buy a PRINTING PRESS. Dan Quayle, George Bush. Now Remington, Marlin. Freedom Group?? I wouldn’t,put my eggs in this basket.