After dealing on and off with accumulating debt for years and filing for bankruptcy, the maker of Gibson guitar has emerged from financial turmoil and is ready to make a comeback, according to Ultimate Classic Rock.
Bankruptcies in the U.S. increased to 25,227 companies in the second quarter of 2016, and while Gibson guitars have been considered a leading name in the industry for generations of legends, Gibson’s $500 million in debts were a result of sharp sales decline of consumer electronics business overseas.
The Gibson brand was founded in 1894 in Nashville, Tennessee and includes other signatures names such as Les Paul and SG. The brand makes its electric guitars in Nashville and Memphis, and its acoustic guitars are constructed in Bozeman, Montana. Gibson sells more than 170,000 guitars each year in more than 80 countries around the world, including Ireland, which had a 2012 GDP of 45,835.75 (ranked 15th in the world). The brand also manufacturers Epiphone and Wurlitzer pianos.
The company’s new majority ownership and leadership team will initiate the takeover on November 1, and according to a press release on global investment company KKR’s website, they will name James ‘JC’ Curleigh as president and CEO. The rest of the senior leadership team will include Cesar Gueikian (chief merchant officer), Kim Mattoon (chief financial officer), Christian Schmitz (chief production officer) and Nat Zilkha (chairman of the Board of Directors).
“As a musician, I have always treasured my Gibson guitars and I have the utmost respect for the iconic Gibson brand and those who choose to play Gibson guitars,” said Curleigh. “Gibson has been a pioneer of craftsmanship and innovation in musical instruments and has been synonymous with shaping the sounds of generations and genres for more than 100 years. I am very honored to play a leading role with this iconic brand.”
This news is a happy ending for a series of financial uncertainties that emerged in Februrary, when it was made public that Gibson was approximately $375 million in debt and had another $145 million to be added by July if it was not paid.
“Joining Gibson is the opportunity of a lifetime for me,” said Gueikian. “As a business person, a musician and lifelong fan of the craftsmanship and quality of Gibson guitars, I am thrilled to help shape the future of a company whose instruments have influenced my life and the sound of music globally. I am committed to collaborating closely with all of Gibson’s stakeholders, including our artists, dealers, our employees and our customers to expand on Gibson’s leadership. I share their passion for Gibson’s iconic instruments and I am confident that together we will create a successful future that is worthy of the company’s incredible heritage.”