Mystery company buying up U.S. gun manufacturers
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donnay
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Look at the people involved:
http://en.wikipedia.org/wiki/Steve_Feinberg
After graduating from college, Feinberg worked as a trader at Drexel Burnham and Gruntal & Co.
In 1992 Feinberg teamed up with William L. Richter to found Cerberus Capital Management with just $10 million under management. Feinberg has been at the helm of the firm since its founding. Later alliances with J. Ezra Merkin were important for raising capital. Subsequent hirings of former politicians and lobbyists John Snow, Dan Quayle and others have served as door-openers in Washington and abroad.
The 2007 Cerberus purchase of Chrysler Corp. from Germany's Daimler Benz became a major and, as of 2009, unsuccessful initiative by Feinberg into a higher-profile investment. Feinberg and others at the firm explicitly presented the investment as patriotic, but many critics ultimately questioned that characterization, especially after Chrysler had to seek and take federal aid. (Chrysler now, with federal help, has been sold to Fiat.) As of 2009, Cerberus was facing major calls from its investors for redemptions, and had written down its investment in Chrysler to 19 cents on the dollar. Had there not been the federal bailout, the investment could have been worth nothing
http://en.wikipedia.org/wiki/Drexel_Burnham_Lambert
Drexel Burnham Lambert was a major Wall Street investment banking firm, which first rose to prominence and then was forced into bankruptcy in February 1990 by its involvement in illegal activities in the junk bond market, driven by Drexel employee Michael Milken. At its height, it was the fifth-largest investment bank in the United States
http://en.wikipedia.org/wiki/John_W._Snow
From 1994 through 1996, he was Chairman of the Business Roundtable, a business policy group of 250 chief executive officers of the nation's largest companies, and played a major role in supporting passage of the North American Free Trade Agreement.
http://en.wikipedia.org/wiki/J._Ezra_Merkin
Jacob Ezra Merkin (born 1954) is a former money manager and financier. He was a close business associate of Bernard Madoff, and is alleged to have played a significant part in the Madoff fraud.
He served as the Non-executive Chairman of GMAC until his resignation on January 9, 2009, at the insistence of the U.S. government.[1]
He was the general partner of Gabriel Capital LP, a $5 billion group of hedge funds which was dissolved in 2008 after heavy losses in the Madoff fraud.
...
In 1988, he started Gabriel Capital to raise capital, and funnel it to managers in exchange for a fee. By 1992, Merkin was raising money and co-managing securities with and for Stephen A. Feinberg, a manager whose private-equity firm Cerberus Capital Management, later bought controlling shares in Chrysler (80%) and GMAC (51%, at a cost of $ 6.4 billion),[8] the financing arm of General Motors.[9] Merkin invested his funds into Cerberus and its portfolio companies. His Gabriel fund invested $79 million in Chrysler, $66 million in GMAC, and $67 million in Cerberus partnerships, according to year-end statements.[10]
On March 30, 2009, it was announced that Cerberus would lose its controlling stake in Chrysler. [11]
In 2005, Cerberus and Gabriel bought a 9.9% combined interest in Bank Leumi, but in April 2009, decided to sell in order to boost liquidity due to their substantial financial losses in 2008.[12]
Merkin manages Ascot Partners LP, a hedge fund which was valued at $1.8 billion prior to the collapse of Bernard L. Madoff Investment Securities LLC.[13]
GMAC
In 2006, Cerberus appointed Merkin as nonexecutive Chairman.[14]
In a statement, on December 10, 2008, GMAC said, "GMAC LLC, the auto and home lender seeking federal aid, hasn’t obtained enough capital to become a bank holding company and may abandon the effort, casting new doubt on the firm’s ability to survive. A $38 billion debt exchange by GMAC and its Residential Capital LLC mortgage unit to reduce the company's outstanding debt and raise capital hasn’t attracted enough participation."
This was in part because Cerberus had raised the credit requirements for car loans so high, virtually eliminating leasing, that they have been responsible for a sizable chunk of lost sales at GM due to customers' inability to secure financing, in order to pressure GM into selling or trading their remaining stake in GMAC. [15]
GM stands to write-off over a billion dollars in lost residuals– which they paid up front to GMAC. GMAC's exposure to the gap in residual values is around $3.5 billion.[16]
As of October 15, 2008, GMAC had $173 billion of debt against $140 billion of income-producing assets (loans and leases), some which are almost worthless, in addition to GMAC Bank’s $17 billion in deposits (a liability). Even if GMAC liquidated the loans and leases, it couldn’t pay back all of its debt.[17]
In January 2009, Merkin resigned from his chairmanship as a condition of the U.S. government. [1] Five days earlier, the Federal Reserve granted GMAC bank holding company status, so it could obtain access to bailout money.[18]
On December 29, 2008, the U.S. Treasury gave GMAC $5 billion from its $700 billion Troubled Asset Relief Program (TARP).
http://www.businessweek.com/magazine/content/05_40/b3953110.htm
...
Cerberus has been shopping up a storm for a year now, seemingly coming out of nowhere to build a corporate empire. With more than $16 billion of investors' assets on its books -- almost double what it had in 2003 -- it has bought 28 companies and snapped up stakes of at least 15% in an additional 15 over the past decade.
According to BusinessWeek estimates, Cerberus controls companies that ring up at least a combined $30 billion in annual sales, more than McDonald's, 3M (AXP ), Coca-Cola (KO ), or Cisco Systems (CSCO ). With more than 106,000 employees, Cerberus companies have a bigger payroll than Exxon Mobil Corp. (XOM ).
Its trophies include 226 Burger King restaurants, the National and Alamo car-rental chains, building-products maker Formica Corp., and the old Warner Hollywood Studios, where blockbusters such as Basic Instinct were made. Its companies connect BlackBerrys, provide medical therapy, and set up military-base camps in Iraq.
...
PICKUP TRUCKS AND BUD
The mind-boggling rise of Cerberus -- from a fringe vulture fund started with a grubstake of about $10 million in 1992 to a Wall Street powerhouse -- has been driven by its enigmatic boss, Stephen A. Feinberg, 45. Like other hedge-fund managers and buyout kings, Feinberg has a penchant for secrecy, although his is more developed than most.
While co-founder William L. Richter deals with investors, and lieutenants such as former Vice-President Dan Quayle jet around the globe to seal deals, the mustached Feinberg keeps very much to himself in a nondescript office on the 22nd floor of a high-rise on Manhattan's Park Avenue. The walls are bare save for a lone photograph of a motorbike that is propped up against his window; a black kid-size motorbike with training wheels -- a gift from an outside adviser -- is parked next to his desk.
...
Cerberus doesn't even have a Web site -- and it doesn't reveal exactly which companies it owns. Feinberg declined to be interviewed or photographed for this story, but dozens of current and former Cerberus executives, investors, and associates spoke with BusinessWeek, many not for attribution.
...
Feinberg majored in politics, producing a senior thesis arguing that drugs and prostitution should be legalized.
For the paper, he not only delved into theories about the appropriate role of government but also spent a summer interviewing cops, hookers, and pimps in New York City. Feinberg took the position to impress a professor who he perceived as liberal after receiving a bad grade arguing the opposite view in a paper the previous year, says a person close to him.
Today Feinberg contributes to Republican causes. He and his wife Gisela sent $114,000 in the 2003-2004 election cycle to committees working to elect Republicans to Congress.
Originally posted TahoeBlue PPF: http://forum.prisonplanet.com/index.php?topic=223885.0;topicseen
http://en.wikipedia.org/wiki/Steve_Feinberg
After graduating from college, Feinberg worked as a trader at Drexel Burnham and Gruntal & Co.
In 1992 Feinberg teamed up with William L. Richter to found Cerberus Capital Management with just $10 million under management. Feinberg has been at the helm of the firm since its founding. Later alliances with J. Ezra Merkin were important for raising capital. Subsequent hirings of former politicians and lobbyists John Snow, Dan Quayle and others have served as door-openers in Washington and abroad.
The 2007 Cerberus purchase of Chrysler Corp. from Germany's Daimler Benz became a major and, as of 2009, unsuccessful initiative by Feinberg into a higher-profile investment. Feinberg and others at the firm explicitly presented the investment as patriotic, but many critics ultimately questioned that characterization, especially after Chrysler had to seek and take federal aid. (Chrysler now, with federal help, has been sold to Fiat.) As of 2009, Cerberus was facing major calls from its investors for redemptions, and had written down its investment in Chrysler to 19 cents on the dollar. Had there not been the federal bailout, the investment could have been worth nothing
http://en.wikipedia.org/wiki/Drexel_Burnham_Lambert
Drexel Burnham Lambert was a major Wall Street investment banking firm, which first rose to prominence and then was forced into bankruptcy in February 1990 by its involvement in illegal activities in the junk bond market, driven by Drexel employee Michael Milken. At its height, it was the fifth-largest investment bank in the United States
http://en.wikipedia.org/wiki/John_W._Snow
From 1994 through 1996, he was Chairman of the Business Roundtable, a business policy group of 250 chief executive officers of the nation's largest companies, and played a major role in supporting passage of the North American Free Trade Agreement.
http://en.wikipedia.org/wiki/J._Ezra_Merkin
Jacob Ezra Merkin (born 1954) is a former money manager and financier. He was a close business associate of Bernard Madoff, and is alleged to have played a significant part in the Madoff fraud.
He served as the Non-executive Chairman of GMAC until his resignation on January 9, 2009, at the insistence of the U.S. government.[1]
He was the general partner of Gabriel Capital LP, a $5 billion group of hedge funds which was dissolved in 2008 after heavy losses in the Madoff fraud.
...
In 1988, he started Gabriel Capital to raise capital, and funnel it to managers in exchange for a fee. By 1992, Merkin was raising money and co-managing securities with and for Stephen A. Feinberg, a manager whose private-equity firm Cerberus Capital Management, later bought controlling shares in Chrysler (80%) and GMAC (51%, at a cost of $ 6.4 billion),[8] the financing arm of General Motors.[9] Merkin invested his funds into Cerberus and its portfolio companies. His Gabriel fund invested $79 million in Chrysler, $66 million in GMAC, and $67 million in Cerberus partnerships, according to year-end statements.[10]
On March 30, 2009, it was announced that Cerberus would lose its controlling stake in Chrysler. [11]
In 2005, Cerberus and Gabriel bought a 9.9% combined interest in Bank Leumi, but in April 2009, decided to sell in order to boost liquidity due to their substantial financial losses in 2008.[12]
Merkin manages Ascot Partners LP, a hedge fund which was valued at $1.8 billion prior to the collapse of Bernard L. Madoff Investment Securities LLC.[13]
GMAC
In 2006, Cerberus appointed Merkin as nonexecutive Chairman.[14]
In a statement, on December 10, 2008, GMAC said, "GMAC LLC, the auto and home lender seeking federal aid, hasn’t obtained enough capital to become a bank holding company and may abandon the effort, casting new doubt on the firm’s ability to survive. A $38 billion debt exchange by GMAC and its Residential Capital LLC mortgage unit to reduce the company's outstanding debt and raise capital hasn’t attracted enough participation."
This was in part because Cerberus had raised the credit requirements for car loans so high, virtually eliminating leasing, that they have been responsible for a sizable chunk of lost sales at GM due to customers' inability to secure financing, in order to pressure GM into selling or trading their remaining stake in GMAC. [15]
GM stands to write-off over a billion dollars in lost residuals– which they paid up front to GMAC. GMAC's exposure to the gap in residual values is around $3.5 billion.[16]
As of October 15, 2008, GMAC had $173 billion of debt against $140 billion of income-producing assets (loans and leases), some which are almost worthless, in addition to GMAC Bank’s $17 billion in deposits (a liability). Even if GMAC liquidated the loans and leases, it couldn’t pay back all of its debt.[17]
In January 2009, Merkin resigned from his chairmanship as a condition of the U.S. government. [1] Five days earlier, the Federal Reserve granted GMAC bank holding company status, so it could obtain access to bailout money.[18]
On December 29, 2008, the U.S. Treasury gave GMAC $5 billion from its $700 billion Troubled Asset Relief Program (TARP).
http://www.businessweek.com/magazine/content/05_40/b3953110.htm
...
Cerberus has been shopping up a storm for a year now, seemingly coming out of nowhere to build a corporate empire. With more than $16 billion of investors' assets on its books -- almost double what it had in 2003 -- it has bought 28 companies and snapped up stakes of at least 15% in an additional 15 over the past decade.
According to BusinessWeek estimates, Cerberus controls companies that ring up at least a combined $30 billion in annual sales, more than McDonald's, 3M (AXP ), Coca-Cola (KO ), or Cisco Systems (CSCO ). With more than 106,000 employees, Cerberus companies have a bigger payroll than Exxon Mobil Corp. (XOM ).
Its trophies include 226 Burger King restaurants, the National and Alamo car-rental chains, building-products maker Formica Corp., and the old Warner Hollywood Studios, where blockbusters such as Basic Instinct were made. Its companies connect BlackBerrys, provide medical therapy, and set up military-base camps in Iraq.
...
PICKUP TRUCKS AND BUD
The mind-boggling rise of Cerberus -- from a fringe vulture fund started with a grubstake of about $10 million in 1992 to a Wall Street powerhouse -- has been driven by its enigmatic boss, Stephen A. Feinberg, 45. Like other hedge-fund managers and buyout kings, Feinberg has a penchant for secrecy, although his is more developed than most.
While co-founder William L. Richter deals with investors, and lieutenants such as former Vice-President Dan Quayle jet around the globe to seal deals, the mustached Feinberg keeps very much to himself in a nondescript office on the 22nd floor of a high-rise on Manhattan's Park Avenue. The walls are bare save for a lone photograph of a motorbike that is propped up against his window; a black kid-size motorbike with training wheels -- a gift from an outside adviser -- is parked next to his desk.
...
Cerberus doesn't even have a Web site -- and it doesn't reveal exactly which companies it owns. Feinberg declined to be interviewed or photographed for this story, but dozens of current and former Cerberus executives, investors, and associates spoke with BusinessWeek, many not for attribution.
...
Feinberg majored in politics, producing a senior thesis arguing that drugs and prostitution should be legalized.
For the paper, he not only delved into theories about the appropriate role of government but also spent a summer interviewing cops, hookers, and pimps in New York City. Feinberg took the position to impress a professor who he perceived as liberal after receiving a bad grade arguing the opposite view in a paper the previous year, says a person close to him.
Today Feinberg contributes to Republican causes. He and his wife Gisela sent $114,000 in the 2003-2004 election cycle to committees working to elect Republicans to Congress.
Originally posted TahoeBlue PPF: http://forum.prisonplanet.com/index.php?topic=223885.0;topicseen
Kluge
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Same thing happened with "bad" drugs. Now, we have a freer drug market, unfortunately violent because of the very high amount of risk created by the "drug war." Same thing happened with alcohol, and immigration. You can't legislate away what people want. If there are no guns for legal sale under reasonable circumstances, they'll create their own market. The gov't loses all control and won't get a cut of the profits. Most people will deal with minor regulations, but there's a fine line where folks'll tolerate regulations and when they'll throw their hands up in the air and just ignore the government.
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osan
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Not necessarily so. If enough arms manufacturers fall into the monobloc ownership, all that is required to put the kybosh on privately held firearms is to then revise the requirements for FFL acquisition to make it effectively impossible for civilians to become manufacturers. Make the fee $100MM, for example. Nobody with a parking ticket or has ever drank alcohol, and so on. If this were to happen, just what do you think the people of the USA would do about it? Beyond goign to court, nothing. If perchance the courts are in the pocket of TPTB, bye bye firearms. Don't have to ban the guns. Just make ammo next to impossible to acquire and it is done. Guns are not very useful without ammunition.
Yes, but then you will have an underground just like the drug market. Any gunsmith can forge a quality firearm and cook up loads
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GuerrillaXXI
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You're right that all ARs are not created equal. Their parts, manufacturing, and quality control definitely aren't the same from one company to the next. A lot of people judge guns only by their appearance -- "It looks/feels like an M16, so it must be just as good as an M16" -- but the truth is that a lot of civilian manufacturers don't make their weapons to military standards. Fortunately, some definitely do (aside from the omission of the unimportant full-auto switch).
You've mentioned some of the best-regarded AR manufacturers (though I'm pretty sure FN doesn't sell ARs to private citizens). Here's a longer list that potential AR-buyers should investigate. All of the following have excellent reputations, so it's just a matter of picking a rifle from a manufacturer who offers the features one desires:
Colt
Larue Tactical
Noveske
Bravo Company Manufacturing (BCM)
Daniel Defense
Lewis Machine & Tool (LMT)
I'm sure I've left some out. There are a lot of AR makers out there now, and I agree with the poster who said it would be very difficult to buy them all. Even so, it's still a little worrisome to see gun manufacture becoming more centralized.
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osan
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Yes, but then you will have an underground just like the drug market. Any gunsmith can forge a quality firearm and cook up loads
Making the gun is not the issue. Even I can do that. Making brass is not that big a deal. Manufacturing lead styphnate for primers is not exactly trivial. How about the production of propellants with highly predictable characteristics and consistent quality between batches? This is absolutely and unequivocally mandatory in order to ensure firearms do not blow up when in use. People lives literally depend on this
Add to these extremely stringent requirements the risks attached to illegal manufacture and you have what amounts to disasters waiting to happen.
If perchance there is a governmental intention to effectively end gun ownership in the manner under discussion, then we will have a choice to make: fight or capitulate. I cannot see how fighting could not lead to physical resistance, and here I mean actual open warfare between the good citizens of the USA and the traitorous occupational government. Think about it - powder and primer production is very serious business that must be undertaken in very tightly controlled conditions in a highly engineered environment. One does not just casually toss together such means, leaving the only other alternative of expropriation of existing means which will not be tolerated by a government seeking to end the common use of firearms by mundanes.
Do you see the problem in concentrating ownership of a vital strategic resource into so few hands? I am not saying it is the case or that it is even likely. I have, however, lived long enough to have known a time when scenarios such as this would have been considered the machination of a truly disturbed psyche. Given the seemingly endless parade of government and corporate outrages to which we have been treated in the intervening years, these same speculations no longer seem far fetched at all.
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Very good point... I was thinking about that as well. It does take a bit of chemistry to make good powder. Load developers go through a rigorous process when they blend powders... you are right, it is not something you should take lightly.
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osan
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Colt's are nothing to write home about, especially for the $$. I consider them, in fact, to be lower quality fare.
Build your own. Start with Aero Precision upper/lower at about $69 apiece - the absolute best bargain on the market. If you have no experience with these you will be very surprised at how good the quality is, which is not just very good, but actually top notch. Add a Rock Creek barrel - one of the best on the planet and a good match trigger and you're in serious business. The owners are old friends of mine and they do very fine work, though not quite inexpensive. rockcreekbarrels.com
If you want top of the line - the best available on the planet - then you go Black Rain Ordnance who machines their uppers and lowers from solid billets. Those will run a good $400 apiece, IIRC, but they are objets d'art.
OBTW, yesterday I shot a friend's Black Rain in 300 Whisper with a can. No hearing protection needed - significantly lower signature than a .22 lr rifle. 220 grain bullet @ about 1100 out the snoot... screwed me up completely. All I heard was the sound of the mechanism cycling and the brass hitting the ground. Notably lighter push than 5.56, too, which is already next to nothing. Fabulous fun. I will need to get one of these one day. Great deer gun - knocks 'em flat and doesn't drive the neighbor's bananas. What more could one ask?
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I second the .300 Whisper... very cool cartridge!
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Pericles
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True, FN does not sell in the market because of the contract restrictions with the .gov. But there are loads of FN parts around.
There is Colt military (which you want) and Colt LE and civilian, which is CINO (Colt in name only). Later, I'll post a tutorial on what to look for in quality AR parts.
There is Colt military (which you want) and Colt LE and civilian, which is CINO (Colt in name only). Later, I'll post a tutorial on what to look for in quality AR parts.
Interesting , I always went with the Colt , basically , because I just was not sure of any others ...
Yeah , I know , who would name a company after that ?
The Henry's are great.
Pericles
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Thanks to these guys, most of my work has already been done - How to recognize military parts:
http://www.ar15.com/forums/t_3_127/...iations_Guide___Another_Work_In_Progress.html
Welcome to two years ago:
http://www.ronpaulforums.com/showth...ailout-fame)-is-buying-up-gun-and-ammo-makers
http://www.ronpaulforums.com/showth...ailout-fame)-is-buying-up-gun-and-ammo-makers
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