This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at http://www.guardian.co.uk/world/2012/dec/19/newtown-shooting-bushmaster-gun
The article has changed 8 times. There is an RSS feed of changes available.
| Version 1 | Version 2 |
|---|---|
| Private equity sale of Bushmaster gun firm 'will not be easy' | Private equity sale of Bushmaster gun firm 'will not be easy' |
| (4 months later) | |
| The sale by a private equity firm of the largest gun maker in the US, which was announced after one of the company's weapons was used in the Newtown school shooting last week, is unlikely to be an easy one, experts have said. | The sale by a private equity firm of the largest gun maker in the US, which was announced after one of the company's weapons was used in the Newtown school shooting last week, is unlikely to be an easy one, experts have said. |
| Likely regulatory changes were signalled by president Barack Obama in a speech in Newtown, Connecticut on Sunday, two days after 20-year-old Adam Lanza used a semiautomatic Bushmaster rifle in a rampage that killed 27 people, including 20 children. Such regulatory changes would mean that gun companies would not be as profitable in the future. | Likely regulatory changes were signalled by president Barack Obama in a speech in Newtown, Connecticut on Sunday, two days after 20-year-old Adam Lanza used a semiautomatic Bushmaster rifle in a rampage that killed 27 people, including 20 children. Such regulatory changes would mean that gun companies would not be as profitable in the future. |
| On Tuesday, Cerberus Capital Management said it would begin selling its investment in the Freedom Group, of which Bushmaster is a part. | On Tuesday, Cerberus Capital Management said it would begin selling its investment in the Freedom Group, of which Bushmaster is a part. |
| "It is basically a fire sale, because of the likelihood of regulations," said Kelly DePonte, a private equity placement agent at Probitas Partners. "Bushmaster is not publicly traded but the publicly traded stock of those who sell automatic weapons is down." | "It is basically a fire sale, because of the likelihood of regulations," said Kelly DePonte, a private equity placement agent at Probitas Partners. "Bushmaster is not publicly traded but the publicly traded stock of those who sell automatic weapons is down." |
| The Newtown tragedy has accelerated the drop in value of stock in the gun makers Smith and Wesson and Sturm Ruger, which dropped sharply on Tuesday, according to Benzinga. | The Newtown tragedy has accelerated the drop in value of stock in the gun makers Smith and Wesson and Sturm Ruger, which dropped sharply on Tuesday, according to Benzinga. |
| It also emerged on Tuesday that the father of Stephen Feinberg, the founder and chief executive of Cerberus Capital Management, lives in Newtown. Martin Feinberg confirmed this in an interview at his house in the town on Tuesday. He said the shooting was "devastating", according to Bloomberg. | It also emerged on Tuesday that the father of Stephen Feinberg, the founder and chief executive of Cerberus Capital Management, lives in Newtown. Martin Feinberg confirmed this in an interview at his house in the town on Tuesday. He said the shooting was "devastating", according to Bloomberg. |
| DePonte said that US investors, worried about the prospect of increased gun control in the wake of the Newtown shootings, would be unlikely to be interested in buying Freedom Group. He said that if Cerberus found a buyer it would be unlikely to be another private equity firm, but probably somebody already in the business, "perhaps a foreign firm that wants to get into the US market". | DePonte said that US investors, worried about the prospect of increased gun control in the wake of the Newtown shootings, would be unlikely to be interested in buying Freedom Group. He said that if Cerberus found a buyer it would be unlikely to be another private equity firm, but probably somebody already in the business, "perhaps a foreign firm that wants to get into the US market". |
| DePonte said that private equity companies, which do not specialise in gun-making, are likely to continue to come under pressure from investors not to invest in guns, or at least companies that sell automatic weapons to the public. | DePonte said that private equity companies, which do not specialise in gun-making, are likely to continue to come under pressure from investors not to invest in guns, or at least companies that sell automatic weapons to the public. |
| "There's been a trend over the years that certain investors, especially endowments or funds related to religious groups, have 'sin' clauses related to alcohol and some of them have related to guns in the past," DePonte said. | "There's been a trend over the years that certain investors, especially endowments or funds related to religious groups, have 'sin' clauses related to alcohol and some of them have related to guns in the past," DePonte said. |
| "It's a matter of degree. It's not necessarily black and white. For instance, Colt Defence sells a lot of guns for military purposes. There's a clear distance in people's minds to those providing guns to government and those providing automatic weapons to individuals. The real storm against Bushmaster is it made the product that was used in the Connecticut massacre and also the DC shootings [of 2002, in which 10 people were killed]. | "It's a matter of degree. It's not necessarily black and white. For instance, Colt Defence sells a lot of guns for military purposes. There's a clear distance in people's minds to those providing guns to government and those providing automatic weapons to individuals. The real storm against Bushmaster is it made the product that was used in the Connecticut massacre and also the DC shootings [of 2002, in which 10 people were killed]. |
| "What's more likely to happen is that there is going to be pressure on limited partners to include clauses that prohibit them from investing in gun manufacturers. It's the Wall Street Journal risk – the risk of having a negative article on the Wall Street Journal. Or the Guardian." | "What's more likely to happen is that there is going to be pressure on limited partners to include clauses that prohibit them from investing in gun manufacturers. It's the Wall Street Journal risk – the risk of having a negative article on the Wall Street Journal. Or the Guardian." |
| DePoint said the number of private equity companies investing in guns was a "tiny fraction of a per cent". He added: "I don't know of a private equity investor in which a major part of their business is selling automatic weapons to civilians." | DePoint said the number of private equity companies investing in guns was a "tiny fraction of a per cent". He added: "I don't know of a private equity investor in which a major part of their business is selling automatic weapons to civilians." |
| In a press statement released on Tuesday, CalSTRS, the Californian State Teachers' Retirement Fund, said: "The tragic and devastating acts that took place... at Sandy Hook Elementary School in Connecticut have prompted many in this country to call for change... in our case, CalSTRS investment staff immediately began reviewing our investments in private equity funds managed by Cerberus Capital Management..." | In a press statement released on Tuesday, CalSTRS, the Californian State Teachers' Retirement Fund, said: "The tragic and devastating acts that took place... at Sandy Hook Elementary School in Connecticut have prompted many in this country to call for change... in our case, CalSTRS investment staff immediately began reviewing our investments in private equity funds managed by Cerberus Capital Management..." |
| The statement went on to say that CalSTRS had a thorough vetting process for investments that tests "not only their financial potential, but their social, human and environmental impacts as well. In fact, current policies require that the risks associated with products that pose significant threats to human well-being be taken into account before an investment is made by CalSTRS investment managers." | The statement went on to say that CalSTRS had a thorough vetting process for investments that tests "not only their financial potential, but their social, human and environmental impacts as well. In fact, current policies require that the risks associated with products that pose significant threats to human well-being be taken into account before an investment is made by CalSTRS investment managers." |
| A spokesman for EIRIS, a not-for-profit organisation which researches investment companies on issues of "environmental and social governance", said a growing number of pension funds were interested in screening out arms and gun manufacturers. | A spokesman for EIRIS, a not-for-profit organisation which researches investment companies on issues of "environmental and social governance", said a growing number of pension funds were interested in screening out arms and gun manufacturers. |
| Mark Robertson, the head of communications of EIRIS, said: "What's clear is that people are concerned about the issue. This highlights the fact that it doesn't make commercial sense to invest in these kinds of industries, especially with Obama suggesting that regulation is imminent. | Mark Robertson, the head of communications of EIRIS, said: "What's clear is that people are concerned about the issue. This highlights the fact that it doesn't make commercial sense to invest in these kinds of industries, especially with Obama suggesting that regulation is imminent. |
| "We work with pension funds around the world. A lot of people don't realise where their funds are invested but when they find out, arms manufacturers are the top of the list of concerns. The first thing they look at is investment in controversial weapons like cluster munitions and land mines and the next logical step is to expand that at look at guns that are used by members of the public." | "We work with pension funds around the world. A lot of people don't realise where their funds are invested but when they find out, arms manufacturers are the top of the list of concerns. The first thing they look at is investment in controversial weapons like cluster munitions and land mines and the next logical step is to expand that at look at guns that are used by members of the public." |
| Cerberus acquired Bushmaster Firearms in 2006. It then acquired at least six other brands and rolled them into one company to create Freedom Group, which is based in Madison, North Carolina. Other brands in the group include Remington Arms, the country's largest and oldest maker of rifles; Marlin Firearms, a manufacturer of lever-action rifles; and Advanced Armament, a maker of pistol silencers. | Cerberus acquired Bushmaster Firearms in 2006. It then acquired at least six other brands and rolled them into one company to create Freedom Group, which is based in Madison, North Carolina. Other brands in the group include Remington Arms, the country's largest and oldest maker of rifles; Marlin Firearms, a manufacturer of lever-action rifles; and Advanced Armament, a maker of pistol silencers. |
| • This article was amended on 21 December 2012. The original referred to Mark Robinson, the communications director of EIRIS. That should have been Mark Robertson, head of communications, and has been corrected. | • This article was amended on 21 December 2012. The original referred to Mark Robinson, the communications director of EIRIS. That should have been Mark Robertson, head of communications, and has been corrected. |
| guardian.co.uk today is our daily snapshot of the top news stories, sent to your inbox at 8am |