WeFixFlats
Respect The Clave
A follow up story...It's Official:
https://reverb.com/news/gibson-file...ruptcy-protection?utm_medium=TW&utm_source=TW
https://reverb.com/news/gibson-file...ruptcy-protection?utm_medium=TW&utm_source=TW
Bad News for the Big G
- Thread starter Dirty_Boogie
- Start date
andy474x
Knows the Drill
Anyone able to translate the nitty gritty of that for us?
matonanjin
New Member
Gibson filed for bankruptcy protection.
garrett
...
Basically, it's a chance to start over. They will restructure their debts into new payment agreements. They will reorganize, which could include downsizing and selling off some of the subsidiaries they own. Time will tell what changes actually take place, but bottom line is their core brands will keep doing business and Henry J will still be at the helm, for now at least.
matonanjin
New Member
Probably. but it depends entirely on who the bankruptcy judge sets up as trustees and what they decide as far as management of the company in bankruptcy protection.
dcm_guitar
New Member
The factory will still be producing guitars. The company will almost surely sell off other business units. The debt payments they owe are being re-structured.
I'm shocked that Henry J is still running the company during this transition. Either he's a "dead man walking" or his management team is going to be gutted very soon. If he stays long-term and his management team gets gutted, he looks like a "sell out". He will have offered up all of his team as a sacrifice in order to keep his role. I can't believe that he's going to stay in the long-term. He's really screwed things up and I'd be shocked if the debt owners will allow him to continue in his role as part of the restructuring. Usually, a stipulation of the debt restructuring is new leadership. Often it's a short-term solution where an accountant is put into the chief role to get things figured out, and then a new CEO will be put in place to run the restructured organization.
This is just the first announcement of many. It will be interesting to see which "heads roll" as this develops. If Henry stays he's a real snake in my estimation.
garrett
...
Hence me saying "for now, at least."
Just read an interesting bit from Bloomberg that strongly implies his days are numbered:
https://www.bloomberg.com/news/arti...bankruptcy-with-deal-to-renew-guitar-business
"Court papers call for a one-year consulting deal and compensation package for Juszkiewicz. A representative for the company didn’t immediately respond to questions about whether Juszkiewicz will remain as CEO or in a separate role."
Regardless, the ownership and leadership balance will change, which will certainly lead to a lot of other changes.
matonanjin
New Member
And then he will resign "to spend more time with family"
andy474x
Knows the Drill
Thanks fellas... I get bankruptcy in general, was more curious about this section:
According to the Gibson statement, "The Company has reached a 'Restructuring Support Agreement' with holders of more than 69.0% in principal amount of its 8.875% Senior Secured Notes due 2018, and its principal shareholders, that clears the pathway for the continued financing and operations of the musical instruments business as well as a change of control in favor of those noteholders."
This agreement with existing noteholders includes an additional $135 million in debtor-in-possession financing to allow the company to continue operations through this transitional period.
According to the Gibson statement, "The Company has reached a 'Restructuring Support Agreement' with holders of more than 69.0% in principal amount of its 8.875% Senior Secured Notes due 2018, and its principal shareholders, that clears the pathway for the continued financing and operations of the musical instruments business as well as a change of control in favor of those noteholders."
This agreement with existing noteholders includes an additional $135 million in debtor-in-possession financing to allow the company to continue operations through this transitional period.
dcm_guitar
New Member
You're never going to get EVERY entity that is owed money to agree on restructuring terms. The best you can hope for is a majority. I read this as the entities that represent 69% of the outstanding debt (that is paying 8.875% interest) have agreed to the restructuring terms. That's a big enough group to drive forward with the restructuring plan. The entities that are owed money who are not part of the 69% are going to have to accept the terms, lose everything or sue for a different plan.
CVS
Not so new member
and to pursue "other interests"And then he will resign "to spend more time with family"
CVS
Not so new member
I am going to be an optimist on this one and take the stance that Gibson guitars will be better off when they come out of bankruptcy. Someone(s) paid a bit too much for this business along the way..................
drdoom8793
THAT guy at Chick-fil-A
Interesting stuff from the rumor mill. Apparently Joe Bonamassa is interested in throwing his hat in the ring to buy Gibson. No way he has that kind of cash, but I assume he would be looking to lead a group of investors.
matonanjin
New Member
dcm_guitar
New Member
Agreed. He's not THAT rich, but he's the kind of name that would excite an investment group. I'd like to see it happen. I think it would be fun to see Gibson have a high-placed "guitar nerd". It would hopefully improve their QC.
drdoom8793
THAT guy at Chick-fil-A
I'm cool with a guitar nerd, just not d-bag Joe
I'm cool with a guitar nerd, just not d-bag Joe
Oh geez... Joe is more a regular guy than most other musicians out there. Hardly a D-bag.
drdoom8793
THAT guy at Chick-fil-A
I've seen several interviews, mostly talking about gear, that makes him sound like a close minded jerk.
Edit: a perfect example:
https://reverb.com/news/joe-bonamassa-calls-pedalheads-lazy-in-new-interview
I happen to agree with every single word he said. Being honest is not being a d-bag. It's not like anyone needs to earn a right to have an opinion, but Joe has certainly earned it based on what he's done. There was nothing offensive in what he said.
jxe
babe en der wood
maybe rite-aid will buy the guitar operation.
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