Gibson Files for Bankruptcy

Yesterday Gibson Brands filed for Chapter 11 bankruptcy protection. Known for its famous guitars, the company is in a similar situation to Toys ‘R’ Us, owing as much as $500 million to creditors including private equity firms like Kohlberg Kravis Roberts, Silver Point Capital and Melody Capital Partners. It took on significant debt — which is about to mature — to finance a series of acquisitions to build up a Gibson Innovations electronics business that it’s now in the process of separating from. Other than buying a stake in TEAC, Bloomberg reports it bought Philips line of headphones and speakers, and until recently had close business ties with Onkyo.

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