Gibson Guitar Maker Files for Chapter 11 Bankruptcy Protection
Gibson Brands Inc., the company behind iconic guitars including the Gibson Les Paul and the Gibson SG, has filed for bankruptcy protection. The guitar maker filed paperwork for Chapter 11 bankruptcy following a “devastating" financial fall.
According to Variety, the Nashville, Tenn.-based group requested court protection from creditors, claiming support from many of them for a deal that will allow the company to survive. A federal judge is required to sign off on Gibson’s bankruptcy plan, which has the support of nearly 70% of their secured lenders.
Gibson guitar sales have declined drastically and the company’s cost-cutting efforts have not been enough to save the business. CEO Henry Jeszkeiwicz said the company will “refocus on our core business” and that he believes in the “company’s long-term stability and financial health.”
The organization will make some changes including the dissolvent of Gibson Innovations, which makes Phillips-branded headphones, speakers and electronic accessories. Thankfully, the company will continue to design, build and sell musical instruments and equipment including their legendary line of guitars, as well as other brands such as Wurlitzer, Dobro and Epiphone.
USA Today reports that Gibson sells more than 170-thousand guitars annually in more than 80 countries around the world. The company claims to sell more than 40% of all electric guitars priced above $2,000.
Gibson, which was founded in 1902 by Orville Gibson, has created many iconic lines of guitars including the ES-335, Flying V and the Explorer, as well as the aforementioned Les Paul and SG.
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