Guitar maker Gibson Brands filed for Chapter 11 bankruptcy protection on Tuesday. The company said it will continue to operate during the reorganization, but will wind down Gibson Innovations, which is mostly operates outside of the U.S.
The Nashville-based guitar maker has struggled with debt ever since its acquisitions of home entertainment and audio brands Royal Phillip, TEAC and Onkyo several years ago..
Gibson said that it has been able to reach restructuring agreements with the holders of 69% of its senior secured notes due in this year. That and $135 million in new financing from existing shareholders will allow the company to continue to operate.