It’s a weird time in the gun community. On one hand, there doesn’t appear to be much if anything to the talk of a “Trump Slump” in gun sales. However, ammunition manufacturers seem to be taking it on the chin. Federal Premium Ammunition has had a couple of rounds of layoffs as it is, with no guarantee more aren’t on the horizon.
Now, we learn that Italian ammunition maker Fiocchi is up for sale.
According to LeccoNotice.com the historical Italian company Fiocchi Munizion S.p.A. might be up for sale.
Fiocchi Ammunition employees 670 people and reached about 150 million Euros in revenues in 2016, a rise from 135 millions in 2015. The positive net finance position was 5 millions, from 3 millions in 2015.
The buyers are likely to be Charme Capital Partners sgr, a private equity firm partly owned by the Montezemolo family.
Due to the nature of Fiocchi’s business the company is considered to be of strategic value to the state, but the Italian Government has officially stated that they will not use their “Golden Rule” to acquire the company. (Source, in Italian) This is an important “go ahead” for the deal to happen.
Just why the company is up for sale isn’t clear, in part because I don’t speak Italian and Google’s translate feature makes the text sound only slightly more literate than a cat running across the keyboard.
However, with the company supposedly making about 150 million euros in 2016, it seems unlikely its sale is due to a lack of profitability. If that’s true, then it’s not suffering from whatever malaise has gotten hold of Federal Premium, for example.
Yet it still seems a little odd that the company is coming up for sale now at a time when so much of the rest of the firearm industry is in flux. Then again, that uncertainty may also be why the sale is happening now. A profit last year doesn’t guarantee a profit this year, much less next year, after all, and with the gun industry still somewhat confused by the changed status quo that is the Trump administration, it’s not difficult to see someone wanting to bail out of the now volatile industry.
Right now, things may seem volatile in the gun industry, but that state of flux is settling down quickly. New products are entering the market and sparking interest, and all of those new products will require ammunition.
While Federal Premium is having their difficulties, it’s unlikely that those difficulties are tied directly to any instability in the gun industry itself, which means it’s a good time to be in the ammo business.
At least that’s one guy’s speculation.
What does seem clear is that whoever snaps up Fiocchi will have a nice moneymaker from the start with a long history providing ammunition to shooters all across the world. It’s my hope that the new owners recognize that worldwide market and continue to value the profitability that comes with providing ammo to shooters in the United States and elsewhere.
With many European’s views on guns, that’s not a guarantee. But then again, someone with those views is less likely to want to buy an ammunition company, so there’s that as well.