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I don't remember seeing this posted here before. Thoughts?

The merger between the gun maker whose Colt revolvers were wielded by Doc Holliday to Theodore Roosevelt and its former military division, which supplies the Army's M4 rifle, is failing to convince bondholders that it will generate enough cash to repay $250 million in debt.

While military supplier Colt Defense's 8.75 percent notes due November 2017 gained 5.5 cents after the West Hartford, Conn.-based company said on July 15 that it spent about $60.5 million to buy the consumer-oriented Colt's Manufacturing Co., the debt trades at 80.75 cents on the dollar to yield 14.96 percent, almost 14 percentage points more than similar-maturity Treasuries. That's about 4 percentage points higher than the threshold for bonds considered distressed.

Adding a $50 million term loan to help finance the purchase will hurt liquidity by boosting interest expense even as the deal gives Colt Defense access to a broader distribution network for its firearms, according to Standard & Poor's. Colt Defense, which forecasts a flat-to-declining U.S. defense budget for the "foreseeable future" as the military winds down foreign missions, would need more than 70 years to build up enough money to pay off the bonds at its current pace of cash generation.
Colt reunited lacks firepower to aid lenders : page 1 - NorthJersey.com
 

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Not to worry, Colt will always be a viable company, regardless of military contracts. Do you remember when S&W was in deep financial concern? Look at them now, the largest producer of firearms. Whatever it takes, I am confident in their survival, whether it be new products or increased production of models that they can't make fast enough, ala SAA's through the custom shop and civilian models of AR's, the demand is there, always has been, always will be. Colt is the American legend. Wish they'd ring back the Colt-Sauer rifles, true masterpieces. Long live the king!!
 

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Not to worry, Colt will always be a viable company, regardless of military contracts. Do you remember when S&W was in deep financial concern? Look at them now, the largest producer of firearms. Whatever it takes, I am confident in their survival, whether it be new products or increased production of models that they can't make fast enough, ala SAA's through the custom shop and civilian models of AR's, the demand is there, always has been, always will be. Colt is the American legend. Wish they'd ring back the Colt-Sauer rifles, true masterpieces. Long live the king!!
Then you should pick up some of their bonds. 15% is a great return if you are sure you will get your principal back.
 

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All they need do is bring back the Python, Diamondback, and a few other long defunct DA revolvers, and the sales surge would bring them out of debt in a couple of months.....;)
The market for a revolver such as the colt Python is most likely very small. Especially at what it would cost to manufacture something as precision and polished as a Python. In today's dollars it would have to retail for $1500 - $2000 dollars. In a world where everyone wants 15 round plastic guns the python would be a niche market player at best.
 

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Unfortunately that is true. The bonds in this, still cheap money, atmosphere are showing that there is a good chance of default. The company is in trouble. They've lost major contracts and profit centers. Civilian nitche markets won't save them. A line of plastic carry pistols would help. I may speak blasphemy but when reality and blasphemy collide call me Gallileo.
 

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while I do not think a widespread production of Pythons is possible ,I could see custom shop one at a time orders like the New Frontier. For what the used ones aregoing for , this would be a bargain. What Colt needs to do is get a 22 Sa revolver, a 22 auto, a da 2 inch 38 and mid frame 357 out there ,as well as the da 9mm pocket 9 ,and expanded 380 lineup. that is where the money is in volume
 

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The market for a revolver such as the colt Python is most likely very small. Especially at what it would cost to manufacture something as precision and polished as a Python. In today's dollars it would have to retail for $1500 - $2000 dollars. In a world where everyone wants 15 round plastic guns the python would be a niche market player at best.
I think you are underestimating the cost. New Pythons and Diamondbacks could easily be in the $2k to $4k range and even then, they may not be equivalent to the originals.
 

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I think you are underestimating the cost. New Pythons and Diamondbacks could easily be in the $2k to $4k range and even then, they may not be equivalent to the originals.
I agree. I was trying to be conservative in my estimate. The real obstacle to recreating the Python is recreating the skilled workforce and craftsman that took Colt 150 years to develop. I am in the business of developing and engineering ways to build precision things. I can tell you that the skill set that is needed retired a long time ago. The generation that has replaced them grew up playing XBOX, not tinkering with things mechanical. In short the training and salaries needed to produce the Python would make it untouchable to all but the well heeled. Of course we could just ask the Chinese to make it for us.
 

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...The company is in trouble. They've lost major contracts and profit centers. Civilian nitche markets won't save them. A line of plastic carry pistols would help. I may speak blasphemy but when reality and blasphemy collide call me Gallileo.


We have a winner. They'll never make it. Who actually owns the name & trademark? I had always heard that the state of CT owns those now having won them as part of the strike negotiations in '86 - '90. If so, the name will die in CT as well as the company. However, countless other big names went teats up, e.g., Sharps, Hopkins & Allen, Iver Johnson, etc., etc. All good things must come to an end.
 

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I think you are underestimating the cost. New Pythons and Diamondbacks could easily be in the $2k to $4k range and even then, they may not be equivalent to the originals.
Ditto...My earlier post was intended to be "tongue in cheek" after the recent posts by those clamoring for the return of the old Colt DA revolvers to save the day and make millions for the company.....:)
 

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Well in this day and age where guns and ammo are "hot items", it would seem unlikely that an established manufacturer like Colt would go belly-up. But anytime you see their bonds trading that high, it means bond buyers are skeptical. And if you think Pythons are expensive now, they would bump up another 20% if the company ceases to exist, even though they haven't produced them in years. The collectible value would skyrocket.
 

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A prior thread discussed this very topic. A lot of what if's and maybe's could they's, the loss of government contracts is a stake in the heart (M4's), with the lack of production that now exists the chances of survival as we know it, is slim.
 

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Colt 1911 Gold Cups The best ever made
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8.750
15-Nov-2017​
15.369​
11.706​
BYes
The bond is noted above. It's a 8.750% callable bond which matures on Nov. 15, 2017. It's rated "B" by Fitch. It does yield 15.369% to maturity (due to current trading prices 25% below par). It is not liquid (doesn't trade much).

It's is not secured (no property or account receivables backing it). It was used to fund the upfront costs of a military contract (the government pays when it wants to). Since Colt Defense is privately owned, it is next to impossible to see a recent financial statement.

No, Colt isn't going to be making Pythons and Diamonbacks. :D
 

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while I do not think a widespread production of Pythons is possible ,I could see custom shop one at a time orders like the New Frontier. For what the used ones aregoing for , this would be a bargain. What Colt needs to do is get a 22 Sa revolver, a 22 auto, a da 2 inch 38 and mid frame 357 out there ,as well as the da 9mm pocket 9 ,and expanded 380 lineup. that is where the money is in volume
I have to say, I think there is a lot of truth in what you are saying Lawman. I don't necessarily hear a lot of people asking for 22 SA revolvers, but they must be selling. Look at the Ruger Single Sixes. What competition from big name makers do they really have? Id love to see that come back. That's something I think any dad would love to buy for his son or daughter. 22 Autos are huge, long gun or handgun, makes no difference. Maybe they should ditch the Walther licensed 1911 and start making the conversion kit, and price it such that an average joe could have a chance at it. Despite popular opinion, the demand for 38 snubs is alive and well. You dont realize it until you try to find the make and model you are looking for and suddenly realize the supply line is dry. Who's making them other than Smith? Sure theres Charter arms, Ruger, and a few others, but I think theres room for more.

What you said about volume is correct in my opinion. Based on my experience, the single most popular handgun is a plastic 9mm. Im not saying Colt should or shouldn't start pushing those, but its just a fact. For every person I hear looking for a 1911 type gun, I'll show you at least 9 or 10 looking for something in plastic 9mm. Usually either Springfield or Glock. (Both good guns, however I own neither.)

It kind of goes back to getting guns in the hands of customers though. If they cant keep up now, how are they going to add anything? I wish Colt the best of luck. I am disappointed the days of going into a gun store and having a large variety of new Colts to handle and view passed before I got into guns. I hope those days return...
 

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Guys will everyone STOP BEATING THE DEAD ECQUINE. Colt can't and won't even attempt to bring back ANY D/A Revolvers much less the Python for all the reasons previously beaten to a bloody pulp.If the companies finances suck this badly what makes you think even if they absolutely wanted to make the plastic fantastic, that they could get the capitol ?. NUFF Said
 

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A famous (unanamed for here) Colt expert toured the factory years ago and was queried what Colt needed to do and he told them..............................bluntly. He told them to stop the expensive, and needless, forging of SAA frames and investment cast them. He also showed them how to polish better & cheaper. He told them that they needed to offer a SAA for circa. $500 and they refused. They then proceeded to import in the abortion that was the Colt Cowboy (made in Czechoslovakia) and further trashed the name.

He said there were two problems that doomed Colt at that time: the mgmt. was made up of non-gun people who were purely bean counters. The second reason was that they are hamstrung by union obligations and that the union refused to negotiate.

Colt missed the boat entirely with the CAS craze that peaked circa. 2000. Instead, they snobbishly chose to cater to the Mounted shooters which has about as much following in the USA as soccer. :rolleyes: The Italians beat them at their own game with conversions, '72 Open Tops, etc. This is a textbook example of why American businesses fail.
 

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Boge,
The Cowboy was NOT (despite this legend that seems immortal) imported (entirely) nor made in Czechoslovakia.
Major parts were cast IN CANADA by Alphacasting, and the guns were built BY COLT IN COLT'S FACTORY.
Denis
 

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the Cowboy came late to the CAS game and was poorly finished and executed. Colt would have done better to have done what they did with the Scouts, had frames made in the US and finished and fitted at Colt. A cast and machined revolver fitted with Colt barrels ,grip frames and cylinders would have made more sense, as would have a stainless version. Colt went on the cheap and flopped.
 
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