As was reported back in late April, Cerberus CEO Stephen Feinberg and others partners were putting together a bid for the Freedom Group. He explained at the time that while they were selling the group of companies he didn't want it to go at fire sale prices.
Both Reuters and the Wall Street Journal report that Feinberg and his group have dropped their bid for the Freedom Group.
Feinberg no longer sees the need to make an offer for the gun company, the person said, because Freedom Group is in dialogue with a number of industry players, as well as financial investors, and he views the sale process as robust.The Wall Street Journal goes into more detail. One source said that Cerberus initially wanted about $1 billion for the Freedom Group but now wants more for it. They have received a number of bids in what is considered to be the first round of bidding.
No deal has been agreed to and talks with the potential buyers are ongoing, the person added.
People familiar with the process say several companies submitted bids last month when a first-round of offers was due.I'd love to know who the bidders are as would we all. You have to wonder if the high bidder will be a investment group like Cerberus, a diversified company like DuPont which used to own Remington years ago, or a firearms manufacturer like Ruger or FNH-USA. Whatever happens will be interesting.
It is possible Cerberus will opt not to sell, one of the people said.
Freedom Group's results have improved amid rising gun and ammunition sales since the tragedy and as restructuring moves implemented by Cerberus take effect, these people said. Cerberus initially planned to seek around $1 billion for the company, but now wants more, one of the people said.
Some of the bids came in over $1 billion while others were lower, one of the people said. It is common in a bidding process for the field of suitors to thin out after the initial round of bidding, so the level of interest in the company remains unclear.