Smith & Wesson Sold in Fire Sale
By David M. Bresnahan

SPRINGFIELD ? A former Smith & Wesson president negotiated the purchase of
the once proud gun manufacturer on Monday.

The purchase of the company by Saf-T-Hammer Corp. of Scottsdale, Arizona from
Tomkins Corp. of Great Britain was a bail out after devastating losses.

?Tomkins? motivation to sell Smith & Wesson as part of its refocused
worldwide operation presented an extraordinary opportunity for Saf-T-Hammer,?
said company chairman Mitchell Saltz in a news release.
Saf-T-Hammer makes a number of gunlocks and is not a gun manufacturer. Robert
Scott, president of Saf-T-Hammer was once president of Smith & Wesson.

Tomkins purchased the historic manufacturer of revolvers for $112 million in
1987 and sold the company for just $5 million now and $10 million in a year.

Saf-T-Hammer stock took an immediate beating on news of the purchase, losing
about a third of its value in a single day. Tomkins stock increased slightly
on the news of the sale Monday.

Smith & Wesson?s troubles began as the company tried to find ways to fight
off a growing number of lawsuits brought by cities and municipalities across
the country. Last March the gun maker agreed to a deal with the federal
government that angered gun rights activists.

Smith & Wesson agreed to help implement government plans to monitor and track
the sale of guns, as well as place locks on guns. Second Amendment defenders
were offended by the move and began a boycott that nearly bankrupted the
company, resulting in major financial losses and company lay offs.

No other gun manufacturer has dared to purchase Smith & Wesson, according to
Larry Pratt, executive director of Gun Owners of America. Pratt said before
the sale that he expected Smith & Wesson would go under and other gun
manufacturers would only be interested in purchasing manufacturing equipment,
but not the company itself.

Saf-T-Hammer announced plans to continue to sell Smith & Wesson firearms, as
well as trigger locks, gun cable locks, and gun safes.
?Smith & Wesson, a brand name for 147 years, would be at the top of any list
of immediately identifiable corporate logos recognized world-wide,? said
Scott in a release.

?We are proud to return this storied company to American ownership,? he
said, adding, ?we plan to increase the company’s revenue through expanded
branding activities and strategic acquisitions that will compliment the
company’s current product lines.?

Smith & Wesson has just received a $1.7 million federal grant with and
additional $1 million promised next year for the development of smart gun
technology. The sale of the company gives Saf-T-Hammer Corp. access to
technology that gun control advocates want the government for mandate for all
firearms. If that happens Saf-T-Hammer Corp. will have the technology needed
by all other gun manufacturers.
In a written statement, Tomkins said that Smith & Wesson profits went from
$13 million in April 2000 to a loss of $4 million by April 2001. Saf-T-Hammer
has agreed to inherit only a portion of Smith & Wesson?s debts.

Tomkins will write off $23.8 million of debt and Saf-T-Hammer will pay off
$50 million in debts over ten years. The sale will result in losses of about
$100 million for Tomkins.