July 2001

Smith & Wesson Sold

Many shooters will be happy to learn that Smith & Wesson, or whatís left of it, has been purchased by Saf-T-Hammer Corp., the Scottsdale-based firearms-safety and security company.

ďSmith & Wesson, a brand name for 147 years, would be at the top of any list of immediately identifiable corporate logos recognized worldwide,Ē said Bob Scott, president of Saf-T-Hammer and former vice president of Smith & Wesson.

Tomkins Corp., a subsidiary of U.K.-based Tomkins PLC, sold Smith & Wesson for $15 million in cash, with $5 million paid upon closing and the balance due in May 2002. As of the close, Smith & Wessonís total assets were approximately $97 million, which includes two manufacturing facilities. The main facility is a 660,000-square-foot plant on 160 acres located in Springfield, Massachusetts. The other facility is a 36,000-square-foot plant in Houlton, Maine. Total liabilities are approximately $53 million, which includes a 10-year note payable to Tomkins for $30 million due in May 2011.

The stock-purchase agreement between Saf-T-Hammer and Tomkins encompasses all assets including patents, trademarks, intellectual property, distribution rights, machine drawings, inventory, equipment and physical assets of Smith & Wesson, including its corporate headquarters in Springfield.

Perhaps this will stem the hemorrhaging of Smith & Wesson, which we have heard about from readers, retailers, suppliers, wholesalers, and nearly everyone else in the gun business. Ed Schultz, S&Wís former president, made a historically bad decision to cave in to Bill Clinton and agree to a host of gun-manufacturing and -marketing restrictions. Many consumers boycotted the company as a result, and many retailers stopped selling S&W products. The company laid off hundreds of employees as sales slowed.

Whether Saf-T-Hammer has the capital and intellectual assets to restore luster to S&Wís brand equity remains to be seen. Gun Tests readers havenít been shy about telling us to stop testing S&W products. The gun-gossip grapevine is very active regarding the sale, and though most comments are positive about the sale itself, some remain gloomy about S&Wís prospects. Some sources close to Saf-T-Hammer told us the company simply isnít large enough to absorb Smith & Wesson and run it properly.

Also, talk about meshing Saf-T-Hammer technology with S&W tooling raised our eyebrows. Part of our skepticism about melding Saf-T-Hammer technology and Smith functionality is our previous experience with Saf-T-Hammer products in the June 1999 review of several gun locks. We didnít recommend the product based on access to a prototype we tested. And we havenít seen Saf-T-Hammer products available for retail sale, but to be perfectly honest, we havenít been looking too hard for them either. Perhaps that will change.

-Todd Woodard