Colt says it now owes about $500 million to 50 creditors.
Historic West Hartford firearms maker Colt has filed for Chapter 11 bankruptcy protection. But the company says it plans to keep its doors open.
Colt, which was founded in Connecticut in 1855, says in its bankruptcy filing it now owes about $500 million to 50 creditors. Colt is owned by private equity investors, and its finances have been worsening, after it missed a key military contract for M4 rifles a couple of years ago, and as the market for firearms has become more volatile.
It filed for bankruptcy at the weekend, but quickly issued a statement saying the filing was a maneuver to allow for a quicker sale of its North American operations.
“We intend to complete the restructuring of our balance sheet we started last fall while meeting all of our obligations to customers, vendors, suppliers and both union and non-union employees. Our plan is a swift and sound pathway to the future that protects an iconic American brand and provides for maximum continuity in Colt’s current and future business operations," the company said.
Colt said it has $20 million in additional financing from its lenders to allow it to continue operations, as it attempts to wrap up its restructuring within 90 days. It’s also signed a long-term extension on the lease for its manufacturing facilities in West Hartford, but it’s certainly possible that some parts of the company could be broken up and sold to different buyers.
