Right-wing conservatives object to Vista's deal to sell Federal ammunition to Czech firm

Patrick Kennedy, Star Tribune on

Published in Business News

More conservative lawmakers are putting pressure on Treasury Secretary Janet Yellen to quash a Czech company's bid for Minnesota-based Federal and other ammunition brands owned by Vista Outdoor.

Sen. John Kennedy of Louisiana became the latest Republican to send a letter to Yellen in her capacity of chair of the Committee of Foreign Investment in the United States (CFIUS), which must approve the Prague-based Czechoslovak Group's plan to buy Vista's Kinetics unit.

The mounting criticism — which also includes objections from a national sheriff's group, Rep. Clay Higgins of Louisiana and Sen. J.D. Vance of Ohio — comes as Vista heads toward a critical shareholder vote on May 16 and as Vista and the Prague-based Czechoslovak Group (CSG) withdrew and refiled their CFIUS application to get an extension. It also comes as false internet rumors abound, so much so that Jason Vanderbrink, head of Vista's Kinetic Group, took to YouTube to address them.

"We have always and will continue to proudly prioritize ammo orders and shipments for our U.S. military and local, state and federal law enforcement agencies," Vanderbrink said on the video. He also assured viewers that CCI, Federal, Hevi-Shot, Remington and Speer ammunition would remain American-made.

In a $1.9 billion deal, Vista has agreed to sell to CSG the Kinetic Group, which includes the Federal, Remington, CCI, Hevi-Shot and Speer ammunition businesses. The rest of the company, which are outdoors product businesses, would then become a new publicly traded company called Revelyst.

There is a competing $3 billion bid for the entire company by an all-U.S. investment group called MNC Capital, led by former Vista board member Mark Gottfredson.


MNC Capital, which has made several offers for Vista, has said selling an American ammunition group is a national security issue since the company holds law enforcement and military ammunition contracts.

A deal with CSG also would concentrate the production of primers with one company. Primers are critical components of ammunition that ignite the propellant and may be the most complex piece of any cartridge. Sources close to MNC Capital say if the CSG deal goes through, it would give the resulting company 70% of the primer market worldwide.

Because of the reliance on Vista for ammunition, the National Sheriffs' Association raised objections to CFIUS earlier this month.

"At this time of heightened global demand, any disruptions in access to affordable and reliable American-made ammunition and primers will hurt sheriffs across the country," the association said in a letter to CFIUS.


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