Guitar Brand Gibson files for bankruptcy.
As of Tuesday, Gibson guitar brands filed for bankruptcy protection. The company has struggled with their debt load and a series of acquisitions.
So, the company filed for chapter 11 U.S. Bankruptcy in Delaware. They will continue to operate throughout the proceedings. However, focuses will be on reorganizing around core businesses.
The struggle with debt for the Nashville based maker of Gibson Les Paul is due to an attempt to finance acquisitions of home-entertainment and audio-equipment makers. Among some of the businesses that the company has added are Royal Phillips’s home-entertainment systems, Onkyo stereos and TEAC.
Gibson has reached an agreement with 69 percent of the senior secured notes due in 2018. This includes shareholders that let the business continue to operate. According to the company, existing noteholders have committed to provide $135 million in debtor-in-possession financing.
Do you think Gibson Guitars can recover from bankruptcy?
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