According to American Outdoor Brands Corporation's board of directors, it will separate its firearms business, Smith & Wesson, from its other outdoor and accessories products due to changes in the political arena.
The separation is expected to take place during the second half of 2020. The split will be executed as a tax-free stock dividend to shareholders.
As separate, standalone companies, both Smith & Wesson and American Outdoor Brands will be independent publicly traded companies.
According to the company's chairman, changes in the political climate is a part of the reason for the separation.
Along with the political changes, other reasons include the economic, investment and insurance markets. From the beginning, they initially embarked on what they believed had been a very successful diversification effort.
Barry M. Monheit said they believe separating as two independent public companies will allow each company will more successfully align its strategic efforts with its capital allocation priorities.
Smith & Wesson has been manufacturing guns since 1852 but decided to change its name to American Outdoor Brands in 2016.
James Debney, CEO at the time, said they believed changing the name to American Outdoor Brands Corp would reflect a better light on their family of brands, their broad range of products, and their plan to continue building on their portfolio of strong American brands.
That said, due to changing times, it seemed to be a necessary move for more than just changing its name. On top of that, approximately 150 CEOs have urged the Senate to take further actions against gun violence.
These CEOs sent a letter to the Senate urging lawmakers to pass stricter gun control legislation. Among these are the CEOs of Walmart and Dick's Sporting Goods who have already changed their firearms sales policies after the outbreak of so many deadly mass shootings.
They are now calling for more gun control across the country.
American Outdoor Brands has been under pressure to assess how their guns are associated with violence. One of the critical factors lies in the effectiveness of gun control groups to damage the reputations of firearm businesses.
The other side of the issue, the passion, dedication, and strength of gun owners for defending their rights when they go to the ballot box and the continued legislative debates regarding guns in America.
Another factor is the overall opinions about guns in the marketplace.