Guitar Center files for bankruptcy

UPDATE: Nov. 23, 2020: Guitar Center filed for Chapter 11 bankruptcy on Saturday to execute a previously announced deal to refinance its debt, inject new liquidity and exit the court process before year`s end. The deal includes $165 million in new equity investments from Ares Management, its private equity sponsor, as well as new investors including The Carlyle Group and Brigade Capital Management.

Dive Brief:

• Guitar Center plans to file for Chapter 11 and be out by the end of the year, the retailer said in a press release.
• The filing is part of a restructuring agreement with key stakeholders, including its private equity owners and "supermajorities" of bondholder groups. The deal would cut $800 million in debt from Guitar Center`s books and add $375 million in new liquidity.
• Once it files, the company expects business and payments to vendors to continue uninterrupted. The retailer said it is "pleased" with its store footprint but has hired advisers to evaluate its real estate portfolio for possible closures.

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RSK: Oh no one of my favorite stores, being a guitar player. Madison may survive however.

Ken Notes: We need a chapter "P" to work with banks and government on pandemic issues...