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Mon Dec 17, 2012, 08:15 PM

Calif. teachers own 6% of Bushmaster

The money behind the Newtown massacre

FORTUNE -- Do you know who owns more than a 6% stake in the maker of .223 Bushmaster rifles, like the one used last Friday to murder 20 first graders and seven adults in Newtown, Connecticut? California public schoolteachers.

The company in question is Freedom Group, a privately-held firearms conglomerate formed by private equity and hedge fund group Cerberus Capital Management. Cerberus created the platform in April 2006 via the acquisition of Bushmaster, after which it added another 10 makers of firearms, ammunition and accessories (including Remington, Marlin Arms and Barnes Bullets).

The California State Teachers' Retirement System (CalSTRS) committed to invest a whopping $500 million into a $7.5 billion Cerberus fund that has helped bankroll Freedom Group. That means that it effectively could own a 6.67% stake in the gun maker, which filed to go public in late 2009 before pulling the offering in early 2011. In fact, the figure could be even higher since CalSTRS also committed $100 million to a $1 billion predecessor fund, which likely made the original investment.

http://finance.fortune.cnn.com/2012/12/17/the-money-behind-the-massacre/?hpt=hp_t2

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Arrow 11 replies Author Time Post
Reply Calif. teachers own 6% of Bushmaster (Original post)
The Straight Story Dec 2012 OP
Earth_First Dec 2012 #1
The Straight Story Dec 2012 #2
Earth_First Dec 2012 #3
proud2BlibKansan Dec 2012 #4
FLyellowdog Dec 2012 #5
msanthrope Dec 2012 #8
avaistheone1 Dec 2012 #10
FLyellowdog Dec 2012 #11
proud2BlibKansan Dec 2012 #6
msanthrope Dec 2012 #9
reteachinwi Dec 2012 #7

Response to The Straight Story (Original post)

Mon Dec 17, 2012, 08:17 PM

1. Seriously?

Please tell me you aren't blaming teachers for this...?

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Response to Earth_First (Reply #1)

Mon Dec 17, 2012, 08:18 PM

2. No, unlike some folks I actually blame the shooter and not god, guns, demons, or games (nt)

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Response to The Straight Story (Reply #2)

Mon Dec 17, 2012, 08:19 PM

3. Right on, thank you...

Well with all the manical madness in the past three days, I wanted to be sure.

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Response to Earth_First (Reply #1)

Mon Dec 17, 2012, 08:20 PM

4. Wouldn't surprise me.

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Response to The Straight Story (Original post)

Mon Dec 17, 2012, 08:20 PM

5. Teachers have absolutely NO control over where their retirement money is held.

This is the state's responsibility.

What a despicable thing to imply that California's teachers had any responsibility for what happened...and that's exactly what this first paragraph does. Yellow journalism at its worst.

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Response to FLyellowdog (Reply #5)

Mon Dec 17, 2012, 08:24 PM

8. Divestment is impossible? nt

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Response to FLyellowdog (Reply #5)

Tue Dec 18, 2012, 04:16 PM

10. What is more despicable is that the teachers don't insist that the retirement fund divest.

Oh what a tangled web they weave...

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Response to avaistheone1 (Reply #10)

Tue Dec 18, 2012, 08:37 PM

11. No, it's not.

Teachers have very little influence on most, if not all, things regarding their jobs/salary. Contrary to popular belief, state teachers' unions are usually not very powerful at all and local district unions are even less so. Whatever political party is in control of the state legislature is the determining factor and we all know how that goes.

Please don't say that teachers not insisting on something is "despicable". I know teacher bashing is in vogue now, but get real. Teachers do a difficult job that most wouldn't do at twice the pay. I taught for 25 years and I'm proud to say that nothing I did was despicable.

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Response to The Straight Story (Original post)

Mon Dec 17, 2012, 08:21 PM

6. A couple comments say it better than I could:

To suggest, as the article's header clearly states, that large institutions like CalSTRS can reduce gun violence by not investing in gun manufacturers is naive and somewhat outrageous. This would have absolutely zero impact on the gun manufacturer. That company is worth a certain amount, and someone will always be willing to pay that fair value. Changing the mix of investors does nothing to change the end result. It's one thing to suggest that CalSTRS should not invest in gun companies, directly or indirectly, out of principle or because it's controversial. It's another thing entirely to suggest that their decision to invest or not invest will somehow effect the likelihood of mass shootings happening in the future.


Not quite. The state of CA teacher's pension plan invested in a private equity firm. That private equity firm then turns around and buys companies...CalSTRS has similar investments in at least 100 PE firms.


On edit - just realized you are using a different title than the one at the link, and your chosen title implies that teachers - NOT their pension funds (which they have NO control over), and not the equity firms that make investment decisions - are profiting from the sale of the weapon that murdered 20 kids in CT. Thats despicable. You should be ashamed.

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Response to proud2BlibKansan (Reply #6)

Mon Dec 17, 2012, 08:33 PM

9. I think I read the 1st comment back in the 80s, when divestment in South Africa was resisted:

To suggest, as the article's header clearly states, that large institutions like CalSTRS can reduce aparthied by not investing in South Africa is naive and somewhat outrageous. This would have absolutely zero impact on the companies of South Africa. Those companies are worth a certain amount, and someone will always be willing to pay that fair value. Changing the mix of investors does nothing to change the end result. It's one thing to suggest that CalSTRS should not invest in South Africa, directly or indirectly, out of principle or because it's controversial. It's another thing entirely to suggest that their decision to invest or not invest will somehow effect aparthied.


Divestment. It's an option.

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Response to The Straight Story (Original post)

Mon Dec 17, 2012, 08:23 PM

7. Divestment

 

Use the language NRA et.al. understands.

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