SK Group is a holding company made up of brands like Israeli Weapon Industries and Meprolight. It’s privately held, which means you can’t just log onto your favorite stock trading site and pick up a few shares. However, the days of not being able to do that are limited, according to a report at Reuters.
Defense holding company SK Group is planning an initial public offering on the Tel Aviv Stock Exchange at a company valuation of 2 billion shekels ($565 million), Israeli financial news websites reported on Monday.
The SK Group, owned by Israeli businessman Samy Katsav, has a portfolio with holdings in several security and defense focused subsidiaries. Among them are Israel Shipyards, one of the largest shipbuilding and repair facilities in the eastern Mediterranean, and Israel Weapon Industries Ltd, which manufactures the Uzi submachine gun.
A spokesperson for SK Group declined to comment on any particulars of the plan.
The initial public offering (IPO) is currently set for mid-2018 and is reportedly being done to help fund SK Group’s planned entry into the Indian market. The company recently opened a factory in the Indian state of Madhya Pradesh in conjunction with Punj Lloyd, an Indian engineering outfit.
Whether this will have any kind of impact on the American gun market isn’t known for sure, but it seems unlikely that there will be any noticeable difference one way or another in the short term.
In the long term, stockholders could possibly pressure SK Group to suspend their forays into the American civilian gun market, which would create an impact. However, that’s unlikely for multiple reasons, up to and including that such hasn’t been the case for other publicly traded gun manufacturers. Ruger and Smith & Wesson are both publicly traded and neither has had any massive, concerted push to cut off sales to the civilian market.
Of course, those companies heavily rely on civilian sales as part of their business model, which might make a difference.
Regardless, SK Group’s IPO should be something interesting to watch.
SK Group’s IWI is known today for their popular Tavor bullpup rifle but is perhaps best known for the venerable Uzi submachine gun and its semi-auto cousins. Back in my youth, if you wanted to look like a badass, you needed an Uzi. The Uzi of today isn’t quite what we had back in my 80’s childhood, but they still make it.
With the influx of cash from an IPO, SK Group may also find some excess funds sufficient to develop a few new products to offer. Since IWI isn’t known for producing poor quality firearms, this would be a huge win for anyone with the cash to buy one.
That probably won’t include me anytime soon (thanks, ObamaCare!), but if it includes you, that could be a big win.
That’s the great thing about the gun market. There are so many awesome things available that it’s hard for consumers to really lose in the grand scheme of things.
As an investor, however, SK Group might be a solid investment with their quality products and military contracts. Something to look at, at least.