WESTLAKE VILLAGE, Calif. — Guitar Center Inc. became the latest U.S. retailer to cite the effects of the novel coronavirus in filing for Chapter 11 bankruptcy on Saturday.
With nearly 300 locations nationwide, the Westlake Village, California-based company is the largest retailer of music instruments and equipment in the United States, but the COVID-19 pandemic forced a substantial portion of their music-loving customers out of brick-and-mortar stores and online, Fox Business reported.
According to CNN Business, the 61-year-old company attempted to weather the pandemic by offering virtual music lessons, but the company was forced to shutter many of their 269 physical locations during national lockdowns in March and never quite recovered.
The company said in a statement that it has negotiated $375 million in debtor-in-possession financing from existing lenders and intends to raise $335 million in new senior secured notes.
Earlier this month the company reached a restructuring agreement with key stakeholders that includes debt reduction of nearly $800 million and new equity investments of up to $165 million to recapitalize the company, Fox Business reported.
The company stated that business operations are expected to continue uninterrupted, the network reported.
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