Czech arms producers Ceska zbrojovka to acquire US firm Colt

Prague/Uhersky Brod, South Moravia, Feb 12 (CTK) - Czech arms producer CZG - Ceska zbrojovka Group SE (CZG) has singed a definitive agreement to take over American arms manufacturer Colt Holding Company LLC, acquiring 100 percent in the company for USD220m (Kc4.7bn), the company said.

It will acquire the stake for upfront cash consideration and the issuance of 1,098,620 shares of newly issued CZG common stock, according to the agreement.

Colt Holding Company LLC is the parent company of US firearms manufacturer Colt's Manufacturing Company LLC.

The transaction is subject to regulatory approval but it is expected to be concluded in the first half of this year.

"This merger is a strategic step for both companies. The acquisition of Colt, an iconic brand and a benchmark for the military, law enforcement and commercial markets globally, fits perfectly in our strategy to become the leader in the firearms manufacturing industry and a key partner for the armed forces," said CZG president and board chairman Lubomir Kovarik.

"We are proud to include Colt, which has stood shoulder-to-shoulder with the US Army for over 175 years, in our portfolio," he added.

With the acquisition, CZG will get significant production capacity in the USA and Canada and expand its global customer base, CZG said.

Colt is a long-term supplier to the US Army and an exclusive supplier of small arms to the Canadian military via its Canadian subsidiary.

Colt is very pleased about the strategic connection. It has reported record-breaking business results over the past five years and the acquisition will enable the company to take advantage of the major opportunity to grow, Colt head Dennis Veilleux said.

CZG is a leading European firearms producer for military and law enforcement, personal defense, hunting and other civilian use. It employs roughly 1,650 people in Czechia, the USA and Germany.

In Q1-Q3 2020, CZG made Kc5bn revenues, which is 10.2 percent more yr/yr.

The company is listed on the Prague Stock Exchange (BCPP).

bst/er