Instrument superstore Guitar Center has officially filed for Chapter 11 bankruptcy.
However, it does not mean the end of the store.
According to the company, the financial move will allow business operations to “continue uninterrupted” as the filing injects “$165 Million in new equity investments” to “recapitalize the company.”
The move will also reduce the store’s debt, currently totaled at nearly $800 million.
“Today we announced a very important and positive step forward to ensure the long-term financial strength of Guitar Center,” CEO Ron Japinga said via press release. “This agreement will allow us to significantly reduce our debt and reinvest in our business in order to better serve our customers and deliver on our mission of putting more music in the world. With ten consecutive quarters of growth prior to the impact from COVID-19, we have been pleased with our resilient financial performance during these challenging times created by the pandemic. As a result of this financial restructuring process, we will be better equipped to execute on and invest in our strategic growth initiatives and we will continue delivering through the strength of our brands, availability of our stores, customer-focused associate relationships, innovative music education programs and our expanding digital solutions.”