https://justthenews.com/nation/longtime-american-gun-manufacturer-colt-sold-czech-firearms-company

Longtime American gun manufacturer Colt sold to Czech firearms company

The gun group CZG said in a blog post this week that it had "signed a definitive agreement to acquire 100% of the outstanding equity interest in Colt Holding Company."

"Subject to the terms and conditions of the definitive agreement," the post said, "CZG shall acquire a 100% stake in Colt for upfront cash consideration of $220 million and the issuance of 1,098,620 shares of newly issued CZG common stock."

Wow did not see that one coming. Weapons are among the last manufactured products that America exports. Colt has been in trouble for a while but you would think with the yuge sales this year they would not be as tempted to sell to a foreign company.

I don’t know all the details of Colt’s financial problems over the years. It seems like if they don’t have a government contract they are in big financial trouble. And it also seems when the government contracts run out it doesn’t take long for them to declare bankruptcy. If those two observations are remotely true then I would think they have been poorly run financially even during the flush times. Which is a shame. I thought after the last government contracts ran out and they declared bankruptcy again this last time that they seemed to have a plan as they started to come out with a new old line of quality revolvers. I would have thought they would have had a chance to stay afloat and stay American owned without selling out to an outside country.

Ruger has done quite nicely over the years without large government contracts and they seem to be able to survive the economic lows we get into occasionally. They have been a well run company as far back as I can remember. S&W has had its issues over the years but they are still doing well. Both of these companies are innovators and make quality arms at decent prices.

With all this said, I think that CZ makes terrific quality firearms. And I believe this is a power play for them to get (eventually) into the big US government contract game like Sig and Glock have done. In order to do so they need to have manufacturing plants here in the US. This positions CZ nicely to possibly grab a contract or two IMHO. I only hope they continue with the Colt quality standards that we have seen in the past  and I hope they continue to expand the Colt revolver line. I have always wondered why Colt kept their manufacturing in deep blue states. Unless they have moved them and I am not aware of it? If they are still in the blue states I would look to CZ to move to red states. And I would hope that they will continue the Colt name.

https://justthenews.com/nation/longtime-american-gun-manufacturer-colt-sold-czech-firearms-company

Longtime American gun manufacturer Colt sold to Czech firearms company

The gun group CZG said in a blog post this week that it had "signed a definitive agreement to acquire 100% of the outstanding equity interest in Colt Holding Company."

"Subject to the terms and conditions of the definitive agreement," the post said, "CZG shall acquire a 100% stake in Colt for upfront cash consideration of $220 million and the issuance of 1,098,620 shares of newly issued CZG common stock."

Whaoo, this a shocker to me

I don’t know all the details of Colt’s financial problems over the years. It seems like if they don’t have a government contract they are in big financial trouble. And it also seems when the government contracts run out it doesn’t take long for them to declare bankruptcy. If those two observations are remotely true then I would think they have been poorly run financially even during the flush times. Which is a shame. I thought after the last government contracts ran out and they declared bankruptcy again this last time that they seemed to have a plan as they started to come out with a new old line of quality revolvers. I would have thought they would have had a chance to stay afloat and stay American owned without selling out to an outside country.

Ruger has done quite nicely over the years without large government contracts and they seem to be able to survive the economic lows we get into occasionally. They have been a well run company as far back as I can remember. S&W has had its issues over the years but they are still doing well. Both of these companies are innovators and make quality arms at decent prices.

With all this said, I think that CZ makes terrific quality firearms. And I believe this is a power play for them to get (eventually) into the big US government contract game like Sig and Glock have done. In order to do so they need to have manufacturing plants here in the US. This positions CZ nicely to possibly grab a contract or two IMHO. I only hope they continue with the Colt quality standards that we have seen in the past  and I hope they continue to expand the Colt revolver line. I have always wondered why Colt kept their manufacturing in deep blue states. Unless they have moved them and I am not aware of it? If they are still in the blue states I would look to CZ to move to red states. And I would hope that they will continue the Colt name.

Well said. 

IMO, colt got spoiled on military contracts. Military and LE can "afford" to overpay. Civilians are spending their own money, so most middle class people like me look for a bang for your buck option. That's where Ruger sells their firearms. Their best sellers like 10/22, Mark series pistols, SA revolvers, DA revolvers, Mini 14/30, bolt action rifles, they are all affordable and reliable. While not the best of the best, they are a good bang for your buck and they've been around long enough to have a great aftermarket following. That's why they sell so well to the average person. They are always adding new models or specialty models that help sales too. Business must be run well or at least I dont hear of them in economic trouble

Colt hasn't really come out with many new firearms in the past several years. Same old stuff with different makeup. You gotta change with the times or at least have new things to sell to a wider range of consumers

But I'm not a business administrator so what do I know 

..... they have been poorly run financially even during the flush times.

Like the NRA?

not surprised. The US has been killing its firearms sector for decades with lawsuits and legislation.

Like the NRA?

I suspect similar. But I have no evidence other than some similarities. I suspect mismanagement and whatever else goes along with that. All of this is just my observations and opinions tho. So take them with a grain of salt. I want to see the NRA survive. But they need to get rid of the Grifters that have them in this situation before they can get back to being the NRA we all remember. And I don’t see any signs yet that the grifters are leaving anytime soon. I have stopped supporting them, and I will not ever support them ever again, until they are all gone.

I think Colt had a great opportunity to become the comeback champ of the firearms world. I personally think their dumping the AR-15 market and their comeback to the revolver market was the key to that. Imagine them making a quality SAA once again. Based on the way the SAA sells still to this day from other manufacturers I believe they would have sold well for Colt. However, I think now that the Colt management were just trying to set the company up for sale. It just smells like upper management trying to maximize their take from the sale of their stock. Instead of making a comeback successfully and being heroes, they came out with the Python (1500 of them) showing successful sales and high demand and now they are announcing the sale of the company. I’ve just seen this sort of thing way too often in my experience in the tech world. I’m not putting it down as they probably would have never survived based on my poor management suspicions. I would rather see them survive and thrive under CZ than to die a slow death under current management. Of course all of this is JMHO.

According to at least on Vlog I watched, Colt made a few bad decisions that led to their situation:

1.  They were seeing a huge rise in demand for their revolvers, partially due to so many first-time gun buyers being more comfortable operating one versus a semi-auto.  So, they decided to retool their factories that were making AR's to make more revolvers.

2.  The remaining AR production lines were used to service the government contracts.  The gov't not only buys military M4 rifles, but they also buy AR-15s for non-military agencies. 

3.  They had a harder time competing with other civilian AR makers.  Colt rifles are no longer in a class by themselves, but the pricing is still higher than most competitors with similar quality ARs.  The decision to continue charging a premium for the Colt name meant a less competitive position in the civilian market.

4.  The decision to completely withdraw from the civilian AR market could not have come at a more inopportune time.  2020 saw a massive spike in gun sales, including the AR-15.  The election being won* by Biden meant an assault weapons ban may be on the horizon.  The huge uptick in first time buyers and in just demand across the board would have driven Colt's revenues through the rood had they produced enough rifles to take advantage of it.

5.  Their messaging to the public as to why they were shutting down their civilian sales of ARs wasn't handled well.  It came across as virtue signaling or acquiescence to gun control pressures, with a manufactured excuse that they needed to focus on gov't contracts.  Had they explained their market strategy, and how the introduction of the new Colt Python reboot fit into that decision, maybe the public would have better understood.  As it happened, most things I saw accused the company of caving to the "get those assault weapons off our streets!" crowd.

Basically, bad timing, poor PR and their short-term business vision is what caused the company to make bad decisions.  Of course, hindsight is 2020.

 

There is a followup story on Reuters.

https://www.reuters.com/article/czg-colt-idUSL1N2QE0EE

Colt, with plants in the United States and Canada, will give CZG the capacity to expand production beyond its main factory in the Czech Republic and allow it to compete in U.S. military contracts because it will fulfil “Buy America” regulations requiring U.S. production.

CZG says it aims to almost double CZG and Colt’s pro-forma combined revenue of around $570 million last year within a few years - putting it on a par with Smith & Wesson’s annual net sales of $1.1 billion in the last fiscal year.

In 2020, the United States accounted for 66% of the Czech gunmaker’s annual revenue, mainly sales to individuals and police departments of guns under its CZ (Ceska Zbrojovka), Dan Wesson and Brno Rifles brands.

Is this supposed to be good news? It took time for products from Honda America to be as reliable as Honda Japan. Bigger is not always better. Hurry up and buy CZ rifles from the old country. We need a tour of the existing Colt factory to determine if their equipment needs to be upgraded.

There is a followup story on Reuters.

https://www.reuters.com/article/czg-colt-idUSL1N2QE0EE

Is this supposed to be good news? It took time for products from Honda America to be as reliable as Honda Japan. Bigger is not always better. Hurry up and buy CZ rifles from the old country. We need a tour of the existing Colt factory to determine if their equipment needs to be upgraded.

At first glance, this one struck me as a teaming of two firearm companies to get together as mutually beneficial.  Some cross pollination that would help both, but maybe wishful thinking.  That said, other firearms company buying/mergers resulted in some steps back.  I'm thinking for CZ, they've had their handguns being manufactured in the US for a while, at least some lines. 

CZ makes nice stuff with very good QC, this will certainly be better than Remington getting bought by a Sporting Goods conglomerate.

Anyone remember when Voit bought Harley Davidson .... 

CZ makes nice stuff with very good QC, this will certainly be better than Remington getting bought by a Sporting Goods conglomerate.

Anyone remember when Voit bought Harley Davidson .... 

I remember that it ended very badly. Quality went out the window.

I remember that it ended very badly. Quality went out the window.

Upside is they trashed the brands reputation enough that its value lowered to the point Willie G Davidson could afford to buy it back. And he busted his ass to get  the company back to the top as an international juggernaut. Sadly once he retired the Harley Board did a bunch of dumb sh*t trying to gain markets in China and shat the bed again.....





 

I'm hoping CZ brings in competent top level management and a credible R&D department staffed with actual degreed engineers.  I don't believe they can compete in "entry" or "mid-tier" level AR's since the market is flooded right now.  I hope they focus on some of their "Crown Jewels" like the Advanced Colt Carbine (ACC), external piston rifle, and some of their more "retro" designs like the CAR-15 (Vietnam - I remember as a kid watching The Green Berets with JW and ever since then have always had a soft spot for the CAR-15), Colt SMG (9mm PCCs are incredibly popular right now), and the 723 (Acid Gambit) and 727 (Gothic Serpent).  I built my CAR upper last year totally unaware it was the 50th anniversary of the Son Tay raid.  Chris Bartocci is by far the foremost expert on modern Colt AR's having worked at Colt during its heyday.


External Piston Colt



Colt ACC



Chris's opinion on why the public turned against Colt





List of Colt Models
https://en.wikipedia.org/wiki/List_of_Colt_AR-15_and_M16_rifle_variants