US buyout firm Cerberus Capital Management LP said today it would immediately start divesting its investment in gunmaker Freedom Group Inc.
The decision was prompted by last week’s shooting at a Connecticut school and the increased pressure from the California State Teachers’ Retirement System (CalSTRS), which said yesterday that it would review its investment with Cerberus.
Freedom Group, with sales of USD677.3m (EUR514.5m) for the nine months ended September 2012, was created from the merger of Bushmaster Firearms International LLC, which Cerberus had acquired in 2006, and other gun companies.
Bushmaster manufactures the AR 15 rifle, which was used by the shooter who killed 27 people, including 20 school children in Newtown.
Cerberus added that the proceeds from the divestment would be returned to investors.