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Owner Of Nation’s Largest Gun Manufacturer Selling Company Because Of Sandy Hook Shooting

by David Badash on December 18, 2012

in News

Post image for Owner Of Nation’s Largest Gun Manufacturer Selling Company Because Of Sandy Hook Shooting

In an incredible response to American anger over the Sandy Hook massacre, the owner of the nation’s largest gun and ammunition manufacturer — which includes notable brands like Remington and Bushmaster — is putting the company up for sale because of the Sandy Hook shooting that took the lives of 20 children and six adults. Bushmaster has quickly become known as the infamous brand of rifle used in the Sandy Hook shooting in Newtown, Connecticut.

Cerberus Capital Management, which created Freedom Group, now the parent company of Bushmaster, Remington, and Marlin, says it’s just not worth the attention and hassle after Sandy Hook.

“It is apparent that the Sandy Hook tragedy was a watershed event that has raised the national debate on gun control to an unprecedented level,” Cerberus states via a press release:

The debate essentially focuses on the balance between public safety and the scope of the Constitutional rights under the Second Amendment. As a Firm, we are investors, not statesmen or policy makers. Our role is to make investments on behalf of our clients who are comprised of the pension plans of firemen, teachers, policemen and other municipal workers and unions, endowments, and other institutions and individuals. It is not our role to take positions, or attempt to shape or influence the gun control policy debate. That is the job of our federal and state legislators.

There are, however, actions that we as a firm can take. Accordingly, we have determined to immediately engage in a formal process to sell our investment in Freedom Group.

“According to Fortune‘s Dan Primack, Cerberus’ sale of Freedom Group is ‘not a financial decision,’ as the holding company’s value is ‘artificially low,’ and a buyer will be hard to find,”  Neetzan Zimmerman at Gawker notes:

However, it is worth noting that the California State Teachers’ Retirement System, one of Cerberus’ largest investors, said yesterday that it would review its indirect investment in Freedom Group in light of the Newtown tragedy.

Also yesterday, Walmart unexpectedly ceased online sales of the Bushmaster assault rifle used by shooter Adam Lanza, though its unclear how long the moratorium will last.

Dick’s Sporting Goods, another major retailer of sporting rifles, said in a statement this morning that it would be suspending the sale of semiautomatic rifles in all stores nationwide for an indefinite period of time.

 

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{ 15 comments }

angelbaby83 December 18, 2012 at 11:26 am

It is sad that it took this most recent tragedy for actions to begin to be taken to at least try and help prevent such things from happening again.

Popeye1959 December 20, 2012 at 8:24 am

And when all the guns are banned only the criminals will have them

uncucumbered December 18, 2012 at 1:11 pm

My bet is they want a sale with terms that will shield themselves from huge damage awards if lawmakers decide to stop shielding gun manufacturer's from product liability lawsuits as a result of Sandy Hook.

Lily02886 December 18, 2012 at 3:43 pm

Hang on to your socks, you will be shocked. In 2005, Bush signed a law that shields gun makers from being sued. The Protection of Lawful Commerce in Arms Act is also commonly referred to as the "Gun Protection Act." The law dismissed all current claims against gun manufacturers in both federal and state courts and pre-empted future claims. – - – Actually NOT a big surprize compared with what Bush did in 2001. As part and parcel of the Homeland Security Act, Bush also absolved all drug companies from liability claims for tainted vaccines. Yes, hard to believe but true. All of those parents whose children were severely harmed by vaccines preserved with Thimerosol ( a Mercury based compund BANNED in Europe) can not longer seek compensation from irresponsable drug companies.

Tanker088 December 19, 2012 at 11:55 pm

Since when did we start suing for product end user actions?
Awful lot of car crashes every day. Guess we better start suing the car companies. Drunk driving? Lets sue Budweiser.
Educate yourself.

uncucumbered December 20, 2012 at 7:17 am

Read the section entitled Exemption From Torte Liability. http://crooksandliars.com/susie-madrak/bush-signe… Until the Bush 2 administration, gun manufacturer's could be sued by the victims of gun violence. If congress repealed what is called the Gun Protection Act because of Sandy Hook, the parents of the slain children could sue Bushmaster. A sale of the company could protect the current owners from those potential lawsuits.

uncucumbered December 20, 2012 at 7:34 am

By the way, Bushmaster was so scared of the Gun Protection Act being revisited that they settled with the victims of the DC sniper for 2 million each despite the ban on manufacturers' lawsuits. http://www.forbes.com/sites/danielfisher/2012/12/… And Huffington Post was the latest to discuss the prospects of a lawsuit by Sandy Hook victims' families just yesterday. Such discussion must be terrifying to Bushmaster whose owners could be protected by a sale. http://www.huffingtonpost.com/2012/12/18/newtown-… There's nothing altruistic about Bushmaster selling the company. They are protecting their bottom line. Take the money and run.
I agree one of us needs to educate themselves on lawsuits against gun manufacturers. But it doesn't appear to be me.

beneaththedam December 18, 2012 at 3:56 pm

Of course, the problem may be that the only civil fabric we share as a "society" is the facilitation of buy/sell/trade transactions; that the only time we're [acting] pleasant toward one another is when there's money changing hands; that we hide behind the supposedly "neutral" language of finance and trade in order to shirk any personal or moral responsibility for our own actions, or the influence of these actions upon the actions of others; that the only cultural memory we keep tabs on is who owes what to whom.

Perhaps its time to start having a discussion about possible courses of action *other* than buying/selling aspects of our being in the perpetual narrative of profit/loss. Perhaps it's time to expand the working definitions of the terms "investment", "role", "influence", and "job" in our society.

Then, perhaps, we may produce more persons worthy of being issued a "man card".

angelbaby83 December 19, 2012 at 7:30 am

In a thoughtful response to this, I agree with a lot of your comments here but two questions come to mind. One is that it is a symptom of free trade or capitalism and I a not sure it is feasible to be able to limit it to specific areas to prevent this type of thing. The other thing that comes to mind is that one of the other very productive methods of commerce, the barter system, I know it can work very easily and well on small scale but I am not sure to its viability on a global one. Just a few thoughts in response to yours.

lsinbc December 18, 2012 at 10:54 pm

Why doesn't he just simply close the damn place down?

Huntercgo December 19, 2012 at 7:13 am

It's an investment company — its only morality is making money. Bad PR is bad for profits. Therefore, they're going to take the money and run.

Tanker088 December 19, 2012 at 11:57 pm

This may be the exception. They can't keep weapons in stock. Good short term investment.

Huntercgo December 20, 2012 at 6:06 am

Sorry, I wasn't clear — Cerberus is not in the business of making guns and I doubt that it wants to be. If it's anything like other investment companies, it wants a fast turn-around for maximum profit — in spite of the spokesman's comment about hassles, with gun sales booming it's a perfect time for them to unload the gun manufacturer, which right now is something of a hot potato in PR terms. There's likely worry about potential blowback from their own investors, particularly the institutional ones — major holdings, most likely, and often sensitive to political issues — they've learned that the threat of withdrawing their investments is often very effective in moving things in the direction they want.

thedawg89 December 19, 2012 at 11:54 pm

Maybe Toyota should shut down the next time a drunk driver uses one to kill another kid. Why would he/they or anyone "just shut the place down" Ludicrous. Next time a craftsmen hammer is used to kill someone they should close Sears. The President and Diane Feinstein have become the single greatest salesperson for the AR-15,don't believe me walk into a local guns hop or sportsmans warehouse. The Gun Industry is making money at a ridiculous rate currently. Someone will scoop up Bushmaster and Remington and they will continue to make huge profit until useless legislation is passed. 9 school shootings during the last "assault weapon" ban.

uncucumbered December 20, 2012 at 7:18 am

Read the section entitled Exemption From Torte Liability. http://crooksandliars.com/susie-madrak/bush-signe…. Until the Bush 2 administration, gun manufacturer's could be sued by the victims of gun violence. If congress repealed what is called the Gun Protection Act because of Sandy Hook, the parents of the slain children could sue Bushmaster. A sale of the company could protect the current owners from those potential lawsuits.

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