Reuters reported yesterday that Remington Outdoor Company is in search of financing that would allow it to file for bankruptcy. They have reached out to a number of banks and credit investment funds.
The move comes as Remington reached a forbearance agreement with its creditors this week following a missed coupon payment on its debt, the sources said. The company has been working with investment bank Lazard Ltd (LAZ.N) on options to restructure its $950 million debt pile, Reuters reported last month.
Remington is seeking debtor-in-possession financing that will allow it to fund is operations once it files for bankruptcy, the sources said. The size of the financing and timing of Remington’s bankruptcy plans could not be learned.
Some potential financing sources, including credit funds and banks, have balked at coming to Remington’s aid because of the reputation risk associated with such a move, according to the sources.
In addition to sales being reportedly down 27% for the first three quarters of 2017, Remington faces a $550 million term loan that comes due in 2019 along with another $250 million in bonds that mature in 2020.
In other words, Remington is facing a perfect storm.