I don't think you can blame the "vulture capitalists." Remington has made dumb decisions for 50 years, when the "gun guys" were running it.
When I was young, the only decent rifle manufacturers (except for lever actions) were Remington and Winchester. The only decent handgun manufacturers were Colt and Smith & Wesson. Now all four have been eclipsed by new upstart companies that were smarter.
The last intelligent thing Remington did was to use modern machining and parts commonality to make their products cost less. That led to the 721/722/700 rifles and the 870. Winchester--in their great stupidity--countered with the post-64 Model 70 without asking any users what they thought of it. Exit Winchester.
And then Remington. Their chief innovations were the ugly Model 600 in oddball calibers nobody wanted and gravelly Model 710. they stupidly let their .260 be stolen by Creedmoor. And after inventing the low-recoil gas operated shotgun, they let every other manufacturer in the world steal their market.
There is a misunderstanding about how private equity works. Nobody tries to bankrupt a company they buy. There's no percentage in that. Instead--by way of example--suppose they want to buy a $100 million company. They borrow 80% based on their reputation in past deals. They pay that off in five years, out of the company's profits (note I said profits) and then sell it. Guess what? They wrote a check for $20 million and pocketed $100 million. 500%.
It gets better.
If they can make the $100 million company grow, say, to be worth $200 million, now they've earned 1000%.
All that's easier said than done, and there are some other wrinkles like carried interest and management fees, but in general private equity is a better investment than stocks and bonds. You have to hedge your bets and have more than one company.
In the case of Remington, I don't know what went wrong after Cerberus bought them.
In the case of Remington, I don't know what went wrong after Cerberus bought them. Nuff said.
