Printer Friendly

The legend lives on.

On March 18, Anthony Autorino announced that he was resigning his position as president and chairman of the board at Hartford, Conn-based Colt's Manufacturing Company.

The following day Colt's announced that the company was filling Chapter 11 in U.S. Bankruptcy Court in order to restructure its finances. The announcement came nearly two years to the day after Colt Industries closed a deal which sold its manufacturing division to an investor group for $75 million and ended the longest labor strike in Connecticut history.

"This is not as critical as if we had filed Chapter 7," said Evan Whildin, manager of marketing at Colt's. "A lot of businesses which are still operating today have filed Chapter 11. This just gives us some flexibility to restructure while we continue to do business."

The company's financial pressures have been building since December 3, 1991, when Colt's reduced its workforce by 17 percent. In past weeks, as Colt's cash began to dwindle, company officials met with its major lenders and state officials in an effort to find a solution to their financial troubles.

Creditanstalt, an Austrian bank which has been Colt's principal lender, reportedly threatened to push for company liquidation if no deal could be made. The following day Colt's announced that it had filed Chapter 11 and received a much needed infusion of cash - $7 million to be exact - from Creditanstalt.

The Connecticut Development Authority (CDA), a branch of the Connecticut Department of Economic Development which loaned the company $500,000 last November, offered to guarantee the first $2 million of the most recent loan. The bank and the CDA agreed to provide as much as $3 million more to help the company with its restructuring.

Connecticut Governor Lowell Weicker Jr. said that the state is making a solid commitment to keep Colt's in business. "We are not here for a short-term bailout. We are here to stabilize the company and see it grow. This is one crown jewel that doesn't leave Connecticut."

The United Automotive Workers, which received over 11 percent of Colt's stock in the 1990 strike settlement, has also offered its support during the company's restructuring period. Eight months ago, Colt's workers agreed to take a 10 percent cut in pay due to the company's financial troubles.

"This restructuring is going to end the day-by-day, bill-to-bill stress of doing business, Whildin said. "It's too soon to speculate on any specific action, but I think you can expect to see significant changes in the very near future."

The deepening recession, feuding among the members of the board, lack of capital, and the reduction of military spending were all sited as reasons behind Colt's financial trouble.

"We still intend to do business as usual," Whildin said, "We wanted this breathing room so that our production and shipping will remain on schedule." According to him, gun dealers should expect no delay in receiving products from Colt's, including the new All American 2000.

After the restructuring is complete, the state is expected to own more than 60 percent of Colt's. Although critics have argued that the state should not invest in a gun company, Weicker said, "I think we are all very proud of Colt and its history in the state of Connecticut and (we are optimistic) about its future."

Gun Shop Held Liable

* On January 16 a jury ordered Guns Unlimited, a Virginia Beach, Wa.-based gun shop, to pay $100,000 to the family of a teacher who was shot and killed by a student. The teen-ager's 40-year-old cousin had bought the gun illegally for the boy at the store.

Daren Farley was a teacher at the Atlantic Shores Christian School in Virginia Beach when she was fatally short with a 9mm pistol in December 1988 during a rampage by student Nicholas Elliott. Elliott also wounded another teacher with the pistol that had been bought three months earlier at Guns Unlimited.

According to Associated Press, the cousin, Curtis Lee Williams, testified he bought the $300 gun with money given him by Elliott, then 15.

Williams, who served a 15-month prison term for lying on the federal paperwork involved in the sale, claimed Elliott was with him in the store, told the sales clerk which gun he wanted to get, andcarried the firearm from the store.

Tony Sassengill, the sales clerk, said he could not remember Williams or Elliott. He said he knew he could not sell any handgun to a minor and would not have allowed such a transaction as described by Williams.

Farley's family had sought $3 million. Randy Singer, the family's attorney, asked for a new hearing on the issue of damages.

Peter Manson Jr., an attorney representing Guns Unlimited, said the case against the gun store was based entirely on the word of Williams, who was convicted of lying on the sales form, and that there was no way the clerk could have known the gun would be used to commit a crime. Manson has asked for a new trial.

Anti-gun groups immediately heralded the decision. Dennis Henigan of the Center to Prevent Handgun Violence told AP this was the first time a jury had held a gun shop liable for damages in such a purchase.

Ruger Guns In Production

* The first of Ruger's new P91 pistols began rolling off the assembly line on February 26. These guns are the long-awaited final version of Ruger's "P" series in .40 S&W.

During the same week the new Ruger 2245 pistol began shipping to dealers - that's the new polymer-framed version of the Ruger Mark II.22 pistol. Both guns should be available to dearlers by the time the May SI hits the stands.

Ruger has also completed production of 25 rifles for the U.S. Palma Match team. The rifles have been sent to the Palma headquarters at the NRA in anticipation of the Palma Match at Camp Perry in August. This year marks the last time in the 20th Century that the Palma Match will be held in the United States.

Swarovski Promotions

* Swarovski Optik of Cranston, R.I., has announced two consumer promotions for 1992 which will be of great interest to dealers who sell optical goods.

The "SL Promotion" offers a $50 merchandise certificate to any consumer who purchases an SL series binocular between January 31 and December 31 of this year and sends in the completed coupon with proof of purchase.

The certificate can be used toward the purchase of $50 or more in merchandise from the same store which sold the binocular initially.

Swarovski's "Go Wild Promotion" offers 10 percent off any safari booked with World Trek of Pueblo, Colo. this can represent a savings of as much as $1,000 for customers hunting either in the U.S. or abroad. In addition, customers will receive a coupon good for the purchase of a Swarovski "Go Wild" jacket at 50 percent off the retail price.

Both promotion end December 31, 1992, interested dealers should contact Swarovski at (800)426-3089.

Handgun Sales Up

50 Percent

* The Oregonian reported that last year the number of residents of Multnomah County, Ore., who purchased handguns increased over 50 percent. Statistics released by the Multnomah County Sheriff's Department reveal that in 1990 there were 769 handguns purchased in the county, but that number increased to 1,119 last year.

Officials believe that the rise in handgun sales can be attributed to several factors: Customers becoming more comfortable and familiar with guns, loosened concealed-carry laws, increasing population, and increased awareness of the new gun laws.

In 1989 only 17 Multnomah County residents who were able to prove that their lives were in danger and that the police were unable to protect them were issued CCW permits. In 1990, however, the legislature loosened the regulations and the county received over 2,700 requests for CCW permits; only 36 were denied.

In 1991, 1,774 individuals applied for the permits and only 33 were turned away, mostly due to criminal backgrounds or histories of mental illness.

It just goes to show that reasonable gun laws are good for more than gun owners - they're good for business, too.

D.C. Liability Law Challenged

* Four Republican Congressmen have field a suit in federal district court challenging the District of Columbia's passage of its liability referendum without Congressional approval.

Filing the suit were Reps. thomas Bliley of Virginia, Larry Combest of Texas, and Dana Rohrabacher and Bill Lowery, both of California. The suit claims the ordinance was enacted in violation of the Home Rule Act, which requires Congress to approve all new city laws.

The D.C. law holds manufacturers, distributors, and dealers of 14 types of semiautomatic firearms liable for damages and injuries caused by the guns, regardless of where in the country they were purchased or how they were misused. Even guns stolen from the police would be covered by the law.

Support also continues to build for a Senate bill that would repeal the D. C. ordinance.
COPYRIGHT 1992 Publishers' Development Corporation
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:Colt files for bankruptcy
Publication:Shooting Industry
Date:May 1, 1992
Previous Article:Special intelligence: industry analysis from the inside.
Next Article:A gun for self defense - is it safe?

Related Articles
Colt's new organization made public.
Creditors charge Colt with fraud in latest lawsuit.
Connecticut bans assault weapons.
Layoffs and patent trouble at ailing Colt's.
Colt's mediation continues - good news for company.
Colt's renews search for investors after reorganization falls through.
Another 11th hour reprieve for Colt's.
Heileman files for reorganization as part of merger.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters