Remington, the U.S.’s oldest big gun manufacturer, should still be able to continue making firearms as it winds its way through bankruptcy, thanks to the approval of loans to the company.
Remington filed for bankruptcy protection this past weekend, hit by falling gun sales and around $950 million of debt that it’s hoping to mostly shake off through the bankruptcy process.
A federal judge approved a $75 million tranche of loans on Wednesday, to keep the company functioning for now. Remington wants $338 million in loans to be approved within the next month, but $75 million is all it gets for now.
Remington secured loan commitments from banks that have already lent money to it, such as Bank of America and Wells Fargo & Co. These banks would of course stand to lose if Remington were to go out of business.
Cerberus Capital Management currently owns Remington, but the idea is for the company’s debtors to get equity in exchange for writing down those debts. Remington hopes to see its debts cut by up to $620 million through the process.
Companies in the firearms business have generally been seeing sales fall during the Trump presidency, as gun owners are not fearful of new legislation that might restrict sales. Remington is also the target of a class action lawsuit related to the use of one of its guns in the Sandy Hook massacre.