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Comment by mtmail | Hacker News Reader

It's a restructuring mostly

"This has been in the works for a while and nobody is really concerned about it. They're still selling guns, building guns, and planning for the future. This was more of a they were behind on their financial payments because of their last buyout and such. When the industry took a downturn they were hit with it. So they need to restructure to be able to pay off debts. They're not going out of business, and they won't be likely to go out of business any time soon, their name is still hugely valuable and they still sell some of the most popular guns on the market (and their quality across the board seems to be getting better, especially their Marlin line). Source: Person in the industry (though not at Remington)"

https://www.reddit.com/r/news/comments/875z4t/remington_one_...

[edit: changed the quoting for readability on mobile]

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From https://qz.com/1219495/remingtons-ar-15-the-financial-histor...

"It was still a profitable company, except that its owners had loaded it up with debt in typical private-equity style to divert profits to themselves. In the first nine months of 2016, the company could pay $45 million in interest to its creditors and still walk away with a $19 million profit. In the same period in 2017, Feinberg and the company’s remaining investors faced a $60 million loss"

So this just appears to be another example of a private equity company buying up and saddling a profitable business with unsustainable debt, much like what happened with Toys'R'Us et al. The same pattern we've been seeing for a while.

Why does this make sense? Do the owning companies get to rid themselves of debt they transferred to the child company?

My understanding of how this game works is pretty bad, so hopefully someone can correct me. The way I understand it, one way to do this is to take a company that has a lot of debt and to use that debt to acquire control over the company without needing to actually buy it as face value. Then the new controller begins charging huge "management fees" to the child company, has the child company pay "dividends" to the new owner, etc, basically lifting the money out of it as directly as they can get away with. Then the empty, indebted shell falls into bankruptcy, and the managers claim a big tax write-off for taking a big "loss" on their investment.

Debt holders should be suing the private equity people for their losses. Otherwise it is a loophole that is easily abused.

The debtholders entered a voluntary contract. They knew the risks. No one forces them to invest into Remington.

Shareholders can sue if the company's management clearly acts against the shareholders' best interest. For example, some shareholders are suing Facebook over the data misuse issue, since it's impacting the stock price: https://techcrunch.com/2018/03/23/facebook-hit-with-sharehol...

Shareholders aren't debtholders.

Please don’t use code formatting for qoutes, it makes your comment unreadable on mobile

I really wish HN used basic markdown, so we could at least quote properly.

this is basic markdown.

use asterisks and put your quote in italics.

No offense, code blocks are easier and HN can fix them so they render properly.

Keep code blocks and block quotes separate.

Code tends to have short lines and are easy to read with the current formatting (even on mobile). Quotes can have long lines which should be wrapped (especially on mobile).

Fine by me; but this is a usability issue and the answer isn’t “wrap every line in asterisks and prepend with an angle bracket”.

Code blocks render properly already. The proper rendering of code blocks (monospaced, fixed line breaks reflecting the original source, because both consistent line breaks and spacing are important for reading code and at least the first and sometimes both are semantically material in code) is not a good rendering for blockquotes.

It would be nice if HN had a format option designed for blockquotes, but in the absence of one using code formatting is the worst possible option, worse than just wrapping the quoted block in quotation marks.

While it’s not proper to use code indenting for this, it would be nice to have block quotes (>) for large quotes like this.

> This is a markdown block > quote, which could be styled > differently than a long italic > block.

ok, changed now

Until HN gives us better formatting for block quotes, don’t expect people to stop using code formatting. Or they can fix code format rendering on mobiles. Or they don’t see a problem with the current setup.

Why can't we expect people to stop doing the one thing that makes it really hard to read?

If you want to quote something, the best way to do that right now is to write it like

  > *This is a quote*

which renders like

> This is a quote

If you have a multi line quote, it’s more difficult to read. Blockindents on long quotes are a long standing typesetting signal.

That's what's implied by financial reporters every time. Most people don't understand restructuring and professionals call it bankruptcy too. Strictly speaking the company goes into creditor protection under CH11 to reorganize it's capital structure or sell it's assets/itself.

Is this purely a "screw the creditors" move a la Trump where company coerces negotiations via threat to fall apart? Except in Trump cases it seems he's usually avoided formal bankruptcy ?

> Most people don't understand restructuring and professionals call it bankruptcy too.

It's called bankruptcy because it is, in fact, a form of bankruptcy established in the Bankruptcy Code under Congress’ Constitutional power to set uniform rules for bankruptcy. See, e.g., the info about chapter 11 reorganization bankruptcies from the US Courts website:

http://www.uscourts.gov/services-forms/bankruptcy/bankruptcy...

Professionals have their own colloquialisms wrt 'bankruptcy', which differs from a laypersons use of the word.

Ch 7 bankruptcy is what most laypeople call 'bankruptcy', which usually applies to individuals (but can apply to corporations). I am aware that Ch 11 is under the US bankruptcy code.

However, bankruptcy in this context (headlines), as used by distressed debt journalists, lawyers, bankers and investors, refers to CH 11 not Ch 7. They'd refer to Ch 7 as 'Ch 7 bankruptcy'. Ch 11 just goes by 'Ch 11' or simply 'bankruptcy'.

Whose intent, I read, is to dodge Sandyhook lawsuits.

Lovely.

Can you point to any evidence of this?

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