California treasurer targets makers of ammunition clips
SAN FRANCISCO (Reuters) - California Treasurer Bill Lockyer will urge the state's pension funds to sell investments in manufacturers of high-capacity ammunition clips, building on his push for them to divest from firearms manufacturers whose guns are banned in the state, a spokesman said on Tuesday.
In response to last month's mass shooting at Sandy Hook Elementary School in Newton, Connecticut, Lockyer is pressing the California Public Employees' Retirement System and the California State Teachers' Retirement System to divest from gunmakers whose weapons California bars private citizens from owning.
The board of the teachers retirement fund, best known as Calstrs, is scheduled to take up Lockyer's plan to divest from the gunmakers on Wednesday, when the treasurer will be able to expand his proposal to manufacturers of ammunition clips banned in California, a spokesman for the fund said.
Lockyer sits on the board of Calstrs and its sister fund, best known as Calpers. The companies that manufacture the clips were not immediately named.
Just days after the shootings in Newton, Calstrs moved to review its holdings managed by Cerberus Capital Management LP, a private equity firm that owns Freedom Group, which manufactures the Bushmaster semi-automatic rifle, one of the firearms used by the gunman in the shooting deaths of 20 children and six adults at Sandy Hook Elementary School.
The gunman also shot and killed his mother at her home and took his own life.
Calling the shootings in Newton a "watershed event" that raised the national debate on gun control, Cerberus plans to sell its interests in Freedom Group and return the proceeds to investors.
Cerberus bought firearms maker Bushmaster in 2006 and later merged it with other gun companies to form Freedom Group. Calstrs' investments through Cerberus give the pension fund a 2.4 percent stake in Freedom Group valued at $8.8 million, according to the fund's spokesman.
California bars the sale of semi-automatic firearms considered assault weapons and Lockyer sees divesting from their manufacturers as complying with a Calstrs' investment policy on investment risks.
The policy requires consideration of risks from investing in companies making products "detrimental to public health and safety," according to a letter Lockyer sent to the chairman of Calstrs' investment committee.
California lawmakers are separately moving to tighten the state's gun laws and restrict sales of ammunition.