6.27.2007

The Apocolypse is upon us.

What happened to musicians helping musicians buy and use gear?

From ProSoundNews.com

Guitar Center To Be Purchased For $1.9 Billion
By
Jun 27, 2007 - 11:14:53 AM



New York (July 27, 2007)--Guitar Center has agreed to be acquired for $1.9 billion by Bain Capital Partners, LLC, a global private investment firm. The total transaction value, including assumed debt, is approximately $2.1 billion. Under the agreement, stockholders will receive $63.00 per share of Guitar Center stock--a 26 percent premium over the $50.06 that the retailer's shares closed at yesterday on June 26, 2007. In early trading following the announcement, the stock shot up to over $60 a share on the NASDAQ.


Guitar Center is comprised of more than 210 U.S. stores. Revenue last year was $2.03 billion, more than six times what it was earning annually when the company went public in 1997; at that point, the stock debuted at $15 a share.


Marty Albertson, Chairman and Chief Executive Officer of Guitar Center, stated, "We believe this transaction delivers outstanding value for our stockholders, and is a strong validation of the Company's accomplishments over the years as well as our future growth prospects. Following a comprehensive review process, our Board of Directors concluded this transaction is in the best interests of our Company and our stockholders and it has the full support of the management team. Bain Capital has a successful track record and significant investment experience in the retail industry and we look forward to partnering with them going forward. We are committed to maintaining our vendor relationships and ensuring our customers will continue to experience the same quality and selection of musical instrument products as well as the high level of service and professional advice through our stores and our websites."

"As the leading retailer of musical instruments in the U.S., Guitar Center enjoys great brand recognition among musicians nationwide, a loyal customer base, and a track record of significant growth," said Jordan Hitch, a Managing Director at Bain Capital. "We look forward to working with the Company's experienced and capable management team to continue to build the business."

This isn't the first major acquisition for Bain; the organization has been previously purchased Toys R Us, Burlington Coat Factory and Michael's. The transaction is expected to close in the fourth quarter of 2007 and is subject to customary closing conditions, including the approval of Guitar Center's stockholders.

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