Cerberus in talks with Lazard to sell gunmaker Freedom Group


Distressed investor Cerberus is reportedly in talks with Lazard about selling its stake in gunmaker Freedom Group, following public outcry over the deadly shooting in a US primary school a week ago.

The firm is understood to be in talks with the investment bank about running a potential auction, but the bank has not been hired yet and Cerberus could end up picking another advisor, the Wall Street Journal reported, citing unnamed sources.

The firm vowed to sell its stake in gunmaker Freedom Group earlier this week following the devastating killings at Sandy Hook Elementary School in Connecticut.

The firm said the massacre, in which 20 children and seven adult staff were killed by a suicidal gunman, was “a watershed event that has raised the national debate on gun control to an unprecedented level”.

Cerberus created Freedom Group after buying gun manufacturer Bushmaster in 2006 – the company that built the AR 15 rifle used by the shooter in the Connecticut school.

Its decision to sell came as CalSTRS, the country’s second largest pension fund with $155bn under management, said it was reviewing its investment with Cerberus in the wake of the shootings.

CalSTRS had invested $751.4m with Cerberus by the end of March 2012, according to its website.

Since the killings US President Barack Obama has given the strongest indication yet that he will look to change US gun ownership laws.

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