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SOUTHPORT, Conn. - Firearms manufacturer Sturm, Ruger & Company, Inc. (NYSE:RGR) announced Tuesday it has adopted a limited-duration stockholder rights plan in response to Italian gunmaker Beretta Holding S.A.’s accumulation of a 9% ownership stake in the company.
The one-year rights plan, which expires on October 13, 2026, is designed to prevent any entity from gaining control through open market purchases without compensating stockholders appropriately. The plan will trigger if any person or group acquires 10% or more of Ruger’s outstanding common stock. According to InvestingPro data, Ruger maintains a strong financial position with more cash than debt and a healthy current ratio of 3.96x, suggesting robust short-term liquidity.
According to the company’s statement, Beretta first disclosed a 7.7% ownership position on September 22, later increasing it to 9% on October 2. Ruger indicated that Beretta has refused to enter into a confidentiality and standstill agreement to facilitate discussions about potential operational and strategic collaborations.
John Cosentino, Jr., Chairman of the Board, said the plan was adopted "to fulfill its fiduciary duties to all stockholders" while expressing openness to discussing Beretta’s ideas for collaboration.
Under the rights plan, if triggered, all holders of rights except the triggering entity would be entitled to acquire Ruger shares at a 50% discount to the market price, or receive one share of common stock for each right.
The company noted that passive institutional investors are exempted from the plan, and current stockholders exceeding the threshold percentage may maintain their positions but cannot increase holdings without triggering the plan.
Ruger has retained RW Baird & Co. as financial advisor and White & Case LLP as legal advisor.
The information in this article is based on a press release statement from Sturm, Ruger & Company.
In other recent news, Sturm, Ruger & Company, Inc. reported its Q2 2025 earnings, where it missed the analysts’ forecast for earnings per share, posting $0.41 compared to the expected $0.51. However, the company surpassed revenue expectations with $132.5 million, which was higher than the projected $121.99 million. New products launched in the past two years contributed to 34% of firearm sales in the second quarter, showing an increase from 32% in the first quarter. Despite a 4% decline in unit sell-through from independent distributors to retailers, which aligned with the industry trend, Aegis Capital maintained its Hold rating and $48 price target for Sturm Ruger. The company also announced the upcoming retirement of Timothy M. Lowney, Senior Vice President of Lean Enterprise, effective October 1, 2025. No details were provided about his successor or the transition plans. These developments indicate a period of transition and mixed performance for the company.
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