The manufacturer of the Bushmaster rifle, one of the guns used in Friday’s horrific attack in Newtown, Conn., was put up for sale on Tuesday, a day after a California pension fund said it might drop its investment.
Cerberus Capital Management, a New York-based private equity firm, cited the massacre as the impetus for putting Freedom Group, which makes Bushmaster rifles among other weapons, on the block.
“We were shocked and deeply saddened by the events that took place at the Sandy Hook Elementary School in Newtown, CT on December 14, 2012,” the investment firm said in a statement.
“We cannot comprehend the losses suffered by the families and friends of those killed by the unthinkable crimes committed that day.”
The tragedy, the company said, was a watershed event “that has raised the national debate on gun control to an unprecedented level.”
Cerberus could not make law or policy, the firm went on to say, but it could take steps to divest itself of its stake in Freedom.
"Accordingly, we have determined to immediately engage in a formal process to sell our investment in Freedom Group," the company said. Once the company is sold, the capital raised would be returned to Cerberus’ investors.
The move by Cerberus comes on a day when stocks of gunmakers continued to drop on Wall Street. At the close of trading on Tuesday, shares of Smith & Wesson Holding Corp. were down about 10% since Monday, and more than 18% since Friday. Gunmaker Sturm, Ruger & Co. was down about 15% over Friday, and about 8% over the previous day.
It also dovetails with a decision by the California State Teachers Retirement System to review its investment in Cerberus.
"CalSTRS investment staff immediately began reviewing our investments in private equity funds managed by Cerberus Capital Management," the pension agency confirmed on Tuesday. "Our investments staff also initiated discussions with Cerberus to learn more about the facts surrounding the investments."
Other businesses also distanced themselves from gun sales after the tragedy. Dick's Sporting Goods, a nationwide chain, said it had suspended sales of semi-automatic weapons, which it called "modern sporting rifles," and stopped selling guns altogether in a Connecticut store.
"Out of respect for the victims and their families, during this time of national mourning we have removed all guns from sale and from display in our store nearest to Newtown and suspended the sale of modern sporting rifles in all of our stores nationwide," the company said.