Olin Corporation Expands Reach with Acquisition of AMMO, Inc. Ammunition Assets

Olin Corporation's Strategic Acquisition of AMMO Assets

In a significant move to strengthen its position in the ammunition market, Olin Corporation (NYSE: OLN) has announced a definitive agreement to acquire the small-caliber ammunition manufacturing assets of AMMO, Inc. (NASDAQ: POWW) for a purchase price of $75 million. The acquisition will utilize Olin’s available liquidity and is expected to be completed by the second quarter of 2025, pending customary conditions.

Strengthening Winchester's Market Position

The acquisition includes AMMO’s advanced brass shellcase manufacturing capabilities along with a cutting-edge production facility located in Manitowoc, Wisconsin. This facility, which spans 185,000 square feet and was completed in 2022, is poised to enhance Winchester’s existing manufacturing operations. Brett Flaugher, President of Winchester Ammunition, noted that this expansion will solidify Winchester's leadership and open opportunities for deeper involvement in high-margin specialty ammunition products.

Anticipated Financial Benefits

Olin's CEO, Ken Lane, emphasized the strategic nature of this acquisition, aligning it with previous initiatives, such as the acquisition of White Flyer in 2023. The Manitowoc facility is expected to generate an incremental adjusted EBITDA ranging from $15 million to $20 million in its first year. With an eye toward efficient integration, Olin anticipates realizing synergies of approximately $40 million by leveraging Winchester’s robust operational capabilities, thereby driving cost efficiencies and accelerating growth within their small caliber product offerings.

The integration is expected to enhance production efficiencies, allowing legacy Winchester plants to reduce costs on existing high-volume products and increase profitability through participation in premium specialty rounds—a segment with higher margins.

Commitment to Future Growth

This acquisition reflects Olin’s commitment to expanding its presence in the ammunition sector while also showcasing a strategic approach to investments that promise immediate contributions to financial performance. The move positions Olin to better respond to market demands and capitalize on growth opportunities within the commercial ammunition market.

In summary, Olin Corporation’s acquisition of AMMO, Inc.'s assets is not just a financial transaction but a calculated step towards enhancing operational capabilities, expanding product offerings, and reinforcing its market leadership in the ammunition industry. Investors and stakeholders alike anticipate strong returns as these assets are integrated into the Winchester business framework, setting the stage for Olin's continued success in the competitive landscape of ammunition manufacturing.