It looks as though Bain Capital i.e. Romney and Co. are about to lose control of one of the nation’s stalwart musical instruments retailers, Guitar Center.
For instrumental musicians, both professional and otherwise, this news may be of greater importance than the recent news surrounding Avid ( ProTools ) made public a few days ago.
Guitar Center seemed to begin having difficulties soon after they were acquired by Bain Capital in 2007. Since then, in my opinion, digital audio solutions like Avid’s ProTools and others, have seen much more of an upswing.
Just to hit you with a few numbers, GC has reportedly amassed over $1.6 billion in debt. The Wall Street Journal suggests that most of this debt stems from the $2.1 billion leveraged buyout orchestrated by Bain in 2007.
What does all this mean for music instrument manufacturers? One source suggests that guitar makers may be greatly impacted. GC keeps so much inventory on hand that the company’s financial problems may be forced onto instrument makers themselves. This may also mean higher prices for that trusty Fender Strat you’ve been eyeballing.