* Cerberus owns 94 pct of shares
* Freedom Group had sales increase of 35 pct in H1 '09
(Adds details from filing, background on Cerberus, NEW YORK to
NEW YORK Oct 21 Private equity firm Cerberus
Capital Management [CBS.UL] is planning to take gun maker
Freedom Group Inc public in a $200 million initial public
offering, according to a regulatory filing.
Freedom Group, which designs, manufactures and markets
firearms under brands that include Remington, Marlin,
Bushmaster, Parker and Nesika, said in the filing it has the
largest market share in all of its major product groups in the
Cerberus, which owns 94.3 percent of Freedom Group's shares
according to the filing, could use a successful IPO after
sustaining massive losses from its investments in carmaker
Chrysler and in GMAC.
Earlier this month, Cerberus successfully took public one
of its portfolio companies, plasma-based protein therapy maker
Talecris Biotherapeutics Holdings Corp TLCR.O. Talecris
raised $950 billion and rose 11.3 percent in its debut. Shares
were up 2.6 percent over the IPO price on Wednesday.
But the filing comes at a time when several other private
equity backed IPOs have stumbled in their debuts. Last week,
RailAmerica (RA.N), owned by funds managed by Fortress
Investment Group LLC (FIG.N), fell 8 percent in its debut after
pricing below expectations.
Freedom Group sold about 1.1 million long guns and 2
billion rounds of ammunition in the year ended June 30, 2009,
according to its prospectus, filed on Wednesday with the U.S.
Securities and Exchange Commission.
In 2006, Cerberus bought Bushmaster Firearms, and in 2007
bought Remington Arms, the largest U.S. maker of rifles.
Subsequently, it bought gunmakers DPMS Firearms and Marlin
Firearms to form Freedom Group.
Freedom Group did not specify what it would use the IPO
proceeds for beyond saying they were for working capital and
The company reported net sales of $427.3 million for the
six months ended June 30, up 34.9 percent over the year earlier
period, and net income of $32.8 million.
(Reporting by Phil Wahba in New York, and Sayantani Ghosh in
Bangalore; Editing by Anne Pallivathuckal and Steve Orlofsky)