HUNTSVILLE, Ala. (WAFF) - For the second time in three years, Huntsville based firearms and ammunition manufacturer, Remington Arms, filed for bankruptcy.
Now, the company is in the process of being split and sold to various buyers in an auction.
On September 29, a hearing was held in Decatur to approve the results of that auction. The sales, which are subject to the court’s approval, would bring in $155 million to be applied to Remington’s debt.
In 2014, the city of Huntsville invested more than $10 million to bring Remington Arms to Madison County.
Leaders at the time had high hopes, it was predicted to bring in thousands of jobs and be the third largest private employer in the area.
Mayor Tommy Battle is still confident the money taxpayers invested will still go to good use.
“We are in great shape,” said Mayor Battle. “Six years ago, the city of Huntsville established a development agreement with Remington. The firearms manufacturer agreed to invest more than 110 million dollars into city property and bring in 2000 jobs.”
Mayor Battle, a key figure who helped lure Remington to the Rocket City, said we are in good shape to get the investment back.
“Now that they have gone into the bankruptcy phase, we either stand to get back the property which is worth 60 or 70 million dollars or get back our 10.5 million dollars," Battle added.
The first bankruptcy filing in 2018 allowed Remington to drop more than $775 million of its almost $950 million in debt. Ownership transferred to some of the company’s former creditors.
That year, the city of Huntsville renegotiated the original development agreement with Remington. The council gave Remington three additional years to meet the goal of hiring 1,800 employees, or forfeit the multimillion-dollar incentive package.
Throughout the next two years, Remington struggled to keep up.
In July 2020, Remington filed for Chapter 11 bankruptcy protection. This forced the Huntsville City Council to pass a resolution authorizing Mayor Battle, the City Attorney and Clerk-Treasurer to take whatever legal actions needed in the bankruptcy case.
Since then, the city has been working closely with outside legal counsel to represent and protect the City’s interests as a second creditor in preliminary bankruptcy hearings.
“We have been monitoring the case all the long, every hearing that has gone along," said Battle.
Federal court proceedings will resume in three weeks. The judge will discuss with the attorneys the status of the sales and any outstanding insurance policies.
The mayor and other city leaders have been talking with potential bidders for the Remington facility.
These are the successful bidders for Remington’s various businesses:
- Vista Outdoor Inc. was the successful bidder for the Lonoke ammunitions business.
- Sierra Bullets LLC was the successful bidder for the Barnes ammunition business.
- Sturm, Ruger & Co. was the successful bidder for the Marlin firearms business.
- JJE Capital Holdings LLC was the successful bidder for the DPMS, H&R, Stormlake, AAC and Parker brands.
- Franklin Armory Holdings Inc. was the successful bidder for the Bushmaster brand and certain related assets.
- Sportsman’s Warehouse Inc. was the successful bidder for the Tapco brand.
- Roundhill Group LLC was the successful bidder for the non-Marlin Firearms business.
The city of Huntsville’s legal team provided the following statement on October 2:
On Tuesday, September 29, 2020, the U.S. Bankruptcy Court for the Northern District of Alabama approved the sales of substantially all assets of Remington Outdoor Company (“Remington”) to eight different buyers. Those sales were the product of a lengthy auction process conducted by Remington that commenced on September 17, 2020. Remington announced the high bidders for its assets on Sunday, September 27, 2020, two days before the Bankruptcy Court’s hearing on the sales.
As part of its auction process, Remington actively marketed for sale its facility in Huntsville, Alabama. Despite its efforts, Remington failed to receive any acceptable bids for the facility. Remington did receive and accept bids to sell its manufacturing and related equipment located at the Huntsville facility. At the September 29 sale hearing, Remington advised the Bankruptcy Court that its sales would take several weeks to close. Remington did not advise the Bankruptcy Court of Remington’s plans with respect to its operations at the Huntsville facility. After the conclusion of the sale hearing, representatives of Remington contacted the City’s representatives to initiate discussions about Remington’s future plans for the Huntsville facility.
The City holds a first-priority mortgage on the Huntsville facility, securing Remington’s $12.5 million debt owed to the City. The City intends to work with Remington as Remington continues its efforts to find an acceptable deal for the Huntsville facility that will result in the prompt and full payment of Remington’s obligations to the City.