Monday, October 10, 2011

Smith & Wesson to shed Franklin-based security firm

Gun maker Smith & Wesson Holding Corp. said it plans to sell off its Franklin-based perimeter security services operation to focus on its core business of making firearms.

The Springfield, Mass.-based company also attributed its plans to a deteriorating environment for the security business amid cuts in government spending.

Known as Smith & Wesson Security Solutions, the unit provides security equipment and installation for the defense, transportation, petroleum and chemical industries, and for corporate facilities, airports and national labs.

Synergy was lacking

The decision comes two years after Smith & Wesson acquired locally based Universal Safety Response in a move to diversify and renamed that company. The security solutions unit has 125 employees, mostly in Franklin, and brought in 13 percent of Smith & Wesson’s revenues for its last fiscal year.

“There weren’t very many synergies between the two business units, so there shouldn’t be much disruption to the core firearms segment that’s remaining for Smith & Wesson,” said WedBush Securities analyst Rommel Dionosio, citing recent growth in the company’s firearm sales as a positive.

Smith & Wesson last week elevated P. James Debney, who had led its firearm division for the past two years, to president and chief executive.

He replaced Michael F. Golden, who, after leading the company for the past seven years, stepped down as part of a succession plan. Golden remains a director and also is now co-vice chairman of Smith & Wesson’s board.