Smith & Wesson, American Outdoor Brands to split amid 'significant changes' in political climate
The company's chairman cited the political climate as part of the motivation behind the move.
Edelman CEO Richard Edelman on sending a letter to the Senate demanding action on gun control.
American Outdoor Brands Corporation’s board of directors announced on Wednesday that it will separate its firearm business – Smith & Wesson – from its outdoor products and accessories business.
The split, expected to be completed in the second half of 2020, will be carried out as a tax-free stock dividend to stockholders. The two remaining standalone companies – Smith & Wesson Brands and American Outdoor Brands – would also be independent publicly traded companies.
The company’s chairman cited changes in the political climate as part of the motivation for the move.
"There have been significant changes in the political climate as well as the economic, investing, and insurance markets since we embarked upon what we believe have been our very successful diversification efforts," Barry M. Monheit said in a statement. "We believe that separating into two independent public companies will allow each company to better align its strategic objectives with its capital allocation priorities."
SMITH & WESSON: REPUTATION AMONG GUN SUPPORTERS IS MAIN CONCERN
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Ironically the company, which has been making guns since 1852, changed its name from the iconic Smith & Wesson to American Outdoor Brands in 2016. Then CEO James Debney said at the time, "We believe the name 'American Outdoor Brands Corporation' will better reflect our family of brands, our broad range of product offerings, and our plan to continue building upon our portfolio of strong American brands."
But changing times have seemingly pushed for more than a name change.
NEARLY 150 CEOS URGE SENATE TO TAKE ACTION ON GUN VIOLENCE
A number of retailers – like Dick's Sporting Goods and Walmart – have updated their firearm sales policies in the wake of a number of deadly mass shootings – which have spurred increasing calls for gun control across the nation.
Nearly 150 CEOs recently sent a letter to the Senate urging lawmakers to pass gun control legislation.
American Outdoor Brands has also faced pressure to assess how its guns are associated with violence.
"The one overriding factor mitigating the effectiveness of gun control groups to damage the reputations of those in the firearms business is the passion and strength of firearms owners in defending their rights at the ballot box, in the course of legislative debates, and in the marketplace," American Outdoor Brands wrote in a statement in February.