Renaissance, Cadence among gun stock sellers as Obama presses for limits

Renaissance Technologies and Cadence Capital Management are among investors to report reduced holdings of weapons-makers after the December massacre of schoolchildren spurred proposals for stricter gun control.

Cadence Capital, among the 10 largest holders of Smith & Wesson Holding Corp. on Sept. 30, liquidated its stake of 1.22 million shares before year-end, filings show. Renaissance disposed of 370,000 Sturm Ruger & Co. shares in the fourth quarter, paring its holding to 2.5% from 4.4%.

The Dec. 14 slayings of 20 students and six educators at Sandy Hook Elementary School in Newtown, Conn., rekindled a debate over gun laws, spurring investors to review holdings in firearms manufacturers even as demand surged to a record. Smith & Wesson and Sturm Ruger, the largest publicly traded U.S. gun-makers, sell military-style weapons that would be banned under proposals by President Barack Obama.

Kevin Reid, Sturm Ruger’s general counsel, and William Bannick, Cadence’s chief investment officer, didn’t respond to requests for comment on the divestitures. Jonathan Gasthalter, a spokesman for Renaissance, declined to comment, and Smith & Wesson’s Liz Sharp didn’t comment.

Public funds across the U.S. are reviewing investments tied to firearms manufacturers.

Cerberus Capital Management, which oversaw $751 million for the $157.8 billion California State Teachers’ Retirement System, West Sacramento, as of March 31, said it would sell Freedom Group, the largest U.S. producer of civilian arms. CalSTRS said last month it will direct fund managers to begin divesting gun-maker stakes.

The $253.2 billion California Public Employees’ Retirement System, Sacramento, will review whether to sell investments in gun-makers totaling about $5 million at a Feb. 19 board meeting, according to the pension fund’s website. CalPERS increased its holdings in Sturm Ruger and Smith & Wesson in the fourth quarter, and the stakes were worth a total of $6.95 million at year-end, according to data compiled by Bloomberg.

The $150.1 billion New York State Common Retirement Fund, Albany, sold all of its holdings in Smith & Wesson through an outside manager on Dec. 18 and will freeze its investment of 45,325 Sturm Ruger shares, which it owns through an index fund, “for an indefinite period,” according to a Jan. 15 statement.