Gibson Files for Bankruptcy Finally – What Happens Next?

What happens next is the bulk of their production will probably be moved to China and they might even lose Epiphone. It really is a shame to see this happen to Gibson but they made some seriously dumb business decisions in the last five years…~TS

Portrait of Orville Gibson (1856–1918), US luthier who founded the Gibson Guitar Company in Kalamazoo, Michigan in 1896

By Tracy Rucinski | Reuters

Gibson Brands Inc, the maker of guitars played by the likes of B.B. King and Elvis Presley, filed for Chapter 11 bankruptcy protection on Tuesday with a plan to reorganize its musical instrument business under the new ownership of its lenders.

Nashville-based Gibson, whose legendary brands include Les Paul and SG, has been suffering under $500 million in debt linked to the acquisition of its consumer electronics business overseas, where sales have been in sharp decline.

In a filing in U.S. Bankruptcy Court in Delaware, Gibson said the overseas consumer electronics business will be wound down, allowing it to re-focus on its core guitar-making and audio businesses.

The audio business includes KRK, Cerwin Vega and Stanton headphones, loud speakers and turntables for amateur and professional musicians and sound engineers.

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Categories: Economic News

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