Legendary gunmaker Colt files for bankruptcy

This is an archived article and the information in the article may be outdated. Please look at the time stamp on the story to see when it was last updated.

WEST HARTFORD -- The legendary American gun maker Colt Defense has filed for bankruptcy, but says that will not affect its business operations.

Colt, which has been making guns for 160 years, on Sunday sought bankruptcy protection in Delaware.

The company, based in West Hartford, said the filing will allow an "accelerated sale" of its business operations in the U.S. and Canada.

West Hartford Town Manager Ron Van Winkle said he is confident that the company will remain local.

"They have a very strong name, Colt firearms. They produce a product that is very well sold throughout the world and so I think they'll come out the other end and be ok,” Van Winkle said.

Sciens Capital Management, an investor in Colt, has agreed to purchase the company's assets and assume its liabilities.

"I think it recognizes that there is value to the assets of Colt,” local bankruptcy attorney Gregory Arcaro said.

Colt said it "intends to continue its normal business operations through the accelerated sale process" and will keep its management team in place, including CEO Dennis Villieux.

The company has been struggling financially and missed a $10.9 million interest payment on its debt in mid-May.

"While entering Chapter 11 protection in the absence of a consensual agreement with our noteholders was not our preference and we do not take it lightly, we are confident it is the best path going forward," said Keith Maib, chief restructuring officer of Colt Defense, in a statement.

He said the filing will allow Colt "to restructure its balance sheet while meeting all its obligations to customers, vendors and employees."

The process is expected to take 60 to 90 days, said Colt.