Iconic U.S. gun maker Colt claims bankruptcy
by Stephen Singer, The Associated Press
The 179-year-old firearm manufacturer filed for chapter 11 bankruptcy, estimating it owes up to $500 million
HARTFORD, Conn.—Analysts are citing several reasons behind Colt Defence’s bankruptcy filing, including struggles to recover from the loss of military business, failure to capitalize on consumer interest in guns and problems in other markets.
The 179-year-old gun maker filed for chapter 11 bankruptcy on Sunday, estimating it owes up to $500 million.
Richard Feldman of the Independent Firearm Owners Association says Colt forfeited gun sales to police forces at least 20 years ago, believing profit margins were too small. Its share of military business also fell sharply.
Moody’s Investor Service analyst Gigi Adamo says Colt’s business with the U.S. government accounts for 10 per cent of sales, down from 60 per cent in 2009. Gun sales to individuals also dropped.
Colt says it will restructure while meeting obligations to customers, vendors, suppliers and workers.
