A report last month noted that music instrumentation chain Guitar Center was gearing up to file for bankruptcy, and to restructure their business. Today, a new report confirms that the plan has been set into motion.
USA Today reports:
Guitar Center said Friday it had reached a restructuring deal with its controlling owner, a fund managed by private equity firm Ares Management, which acquired its stake in Guitar Center in 2014. The company said it also got support for its deal from new investors Brigade Capital Management and a fund managed by The Carlyle Group and from various lenders.
The company plans to stay in business. This year's pandemic hit the chain hard, as it did most retailers. The company has almost 300 Guitar Center stores and an additional 200 Music & Art stores. The company would not commit to whether they were keeping all the stores open or shutting some down, noting to USA Today that they hired a real estate firm "to explore opportunities to optimize its real estate portfolio and other agreements to focus on investments that best position the Company to return to its growth trajectory prior to COVID-19."
Guitar Center CEO Ron Japinga said in a statement “This agreement will allow us to significantly reduce our debt and reinvest in our business in order to better serve our customers and deliver on our mission of putting more music in the world."
Do you shop regularly at Guitar Center or have you moved to purchasing your gear online?
