A gun dealer who stocked up on firearms while expecting Hillary Clinton to win the White House in 2016 has now filed for bankruptcy.
Bloomberg reports that firearms distributor United Sporting Cos. this week filed for Chapter 11 bankruptcy protection after its big bet that a Clinton victory would spark a massive spike in gun sales from fearful Trump supporters.
In a court declaration, United Sporting CEO Bradley Johnson said that his business had been hammered by having lower-than-expected sales in the wake of President Donald Trump's upset victory in 2016, as well as getting stuck with excessive inventory.
All of this forced United to sell its guns at bargain-basement prices, which in turn shredded its profit margins, the company claims.
However, attorneys for Prospect Capital Corp., one of the gun distributor's lenders, dismissed Johnson's claims that Trump's victory put him out of business and instead blamed financial mismanagement for the company's woes.
"A few years ago, United was the largest distributor of firearms in the U.S., according to the objection," Bloomberg reports. "But [equity owner] Wellspring 'cashed out' more than $183 million through dividend recapitalization deals in 2012 and 2013, then appointed fiduciaries who 'grossly mismanaged the business and depleted all reserves necessary to weather the storms and the headwinds the business would face,' the dissenting lenders said."