(RNN) – The maker of some of America’s most iconic guitars has filed for bankruptcy.
Gibson Brands, Inc. announced on Tuesday that it was reorganizing under Chapter 11 of the U.S. Bankruptcy Code.
"Over the past 12 months, we have made substantial strides through an operational restructuring," Gibson Chairman and CEO Henry Juszkiewicz said.
The reorganization will center around the company’s core musical Instruments and pro audio business. Gibson will wind down its consumer-electronics business.
Other Gibson brands include Epiphone, Baldwin, Dobro, Kramer and Steinberger.
“The decision to re-focus on our core business, Musical Instruments, combined with the significant support from our noteholders, we believe will assure the company's long-term stability and financial health,” Juszkiewicz said.
The bankruptcy petition shows the company has up to $500 million in debt. It also states that lenders will provide a new loan of up to $135 million to keep Gibson in business, Bloomberg reported.
"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.
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