Remington arms undergoes multi-million dollar recapitalization - Industry News

Shooting Industry, April, 2003

Remington Arms Co, a wholly-owned subsidiary of RACI Holding Inc., a Clayton, Dubilier & Rice Inc. (CD&R) portfolio company, announced in January a recapitalization. The transaction includes a $30 million equity investment in RACI from a fund managed by Bruckmann, Rosser, Sherrill & Co. L.L.C. (BRS); the refinancing by Remington of approximately $100 million of debt and the issuance by Remington of an expected $175 million in unsecured, interest-bearing senior notes.

CD&R Fund IV purchased Remington in December 1993 for $75 million in equity and currently owns approximately 87 percent of RACI. As part of the transaction, CD&R Fund IV and other current shareholders, including Remington's management, will retain a significant percentage of RACI's common stock and receive a combination of cash and senior notes issued by RACI. Specific terms were not disclosed.

According to officials, CD&R will continue to remain active in the company's strategy and governance. RACI's current 10-member board of directors will remain in place and will be expanded with the addition of two new members nominated by BRS.

"We believe the recapitalization will give us the financial flexibility to continue to pursue ongoing productivity enhancements, new product introductions and other operational improvements. We welcome the support and involvement of our new partners at BRS," said Thomas L. Millner, Remington's president and CEO.