Gibson Brands Inc. has filed for Chapter 11 bankruptcy protection. What does that mean?
It means Gibson owes a lot of people a lot of money and plan to restructure the entire company to try and make the money they need to stay in business.
A change of control in Gibson, will change ownership from current stockholders like CEO Henry Juszkiewicz, who many blame for Gibson’s current financial troubles, and replace them with new lenders like Silver Point Capital, Melody Capital Partners and funds affiliated with KKR Credit Advisors.
The restructuring will also eliminate Gibson’s consumer electronic division.
Juszkiewicz says the restructuring “will be virtually invisible to customers, all of whom can continue to rely on Gibson to provide unparalleled products and customer service.”
Brian J. Fox, a managing director at Alvarez & Marsal will serve as the company’s chief restructuring officer, said in the filing that Gibson now has “an exit path from Chapter 11 as a deleveraged business, poised for continued growth.”
Gibson, founded in 1902, has been around for a long time, and hopefully be around for awhile longer.
“The Gibson name is synonymous with quality and today’s actions will allow future generations to experience the unrivaled sound, design and craftsmanship that our employees put into each Gibson product,” Juszkiewicz said in a statement.