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Bankruptcy Law Blog

Thursday, June 20, 2019

Lessons Learned from the Remington Bankruptcy

In 2014, when Remington announced it was opening a new factory in Huntsville, the whole state of Alabama was excited. It was now possible to buy a rifle that didn’t just say Made in the USA, it said Made in Alabama. Everyone seemed to want one. It was shocking when just a few years later the company announced it was filing for bankruptcy. 

A recent news story fills in some of the gaps, and tells the story of how the iconic company got saddled with a lot of debt just as the market for guns cooled. It is a good reminder that sure things don’t exist in the financial world, and a good illustration of how filing for bankruptcy can get a business or a person back on track after making a financial mistake. 

What Happened at Remington? 

The city of Huntsville gave Remington its new factory. The state of Alabama gave the company tax abatements and offered to train its workers for free. The Tennessee Valley Authority provided discounted electricity. So, how did the company get into so much debt it had to file for bankruptcy? 

Apparently it was some fancy financial wizardry by the private equity firm that bought the iconic company in 2007. Basically, the company that bought Remington took out a huge loan and then stuck Remington with the tab. 

The bills came due just as the market for guns cooled — which happened to be when President Trump took office and people were no longer stockpiling guns in fear of a government crackdown on ownership. Remington suddenly ran out of the cash it needed to pay off its debts, and government investigators found it wasn’t employing as many people as it promised to, so it also lost some of its generous government incentives. 

Lessons Learned

Seeing a successful company make mistakes, take a hit from something completely unexpected, and then go through the bankruptcy process is sort of reassuring. Sometimes things just go wrong, and there is no shame in filing for bankruptcy in order to set them right again. 

If a big company like Remington, which has been around for over 100 years, can make a poor financial decision, then get blindsided when the markets change, it’s okay if something similar happens to you. You should not be ashamed if you need to use the bankruptcy law to set things right. That’s what it is there for. 

Don’t Be Afraid To Ask For Help

If you have made a poor financial decision, or been taken off guard by circumstances out of your control, you are not alone. And you don’t have to go through the bankruptcy process alone. Our firm has helped hundreds of families use the bankruptcy system to get their life back together. 

If you are wondering if bankruptcy is right for you, don’t hesitate to contact our office in Mobile to schedule a free initial consultation. We can discuss your options so you can decide which path forward is best for you. 

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Padgett and Robertson assist clients with Bankruptcy, Personal Bankruptcy, Consumer Bankruptcy, Chapter 7 Bankruptcy, Chapter 13 Bankruptcy and The New Bankruptcy Law in Mobile, Alabama and throughout southern Alabama. Alabama State Bar Association Regulations require the following: "No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers." 11 U.S.C. 528 of the U.S. Bankruptcy Code requires the following: "We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.”



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Alabama State Bar Association Regulations require the following: "No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers." 11 U.S.C. 528 of the U.S. Bankruptcy Code requires the following: "We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.”