Struggling Gibson speaks out about its finances
Amid reports that the company is "running out of time" to sort out its finances, Nashville-based Gibson Brands on Thursday sought to assure observers that its obligations will be met.
Gibson, the parent company of the popular guitar brand and a variety of consumer audio products, issued a news release to announce "that it has met all current obligations to the bondholders, is in the process of arranging a new credit facility to replace the bonds, and fully expects the bonds to be refinanced in the ordinary course of business."
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"We have been monetizing assets like stock holdings, real property and business segments that could not achieve the level of success we expected," CEO Henry Juszkiewicz said in the news release. "By monetizing these assets, we can reduce debt and generate funds to contribute to business segments that are thriving. It is important to our business to get back to the financial success we had to achieve the best financial terms in the refinancing of our company."
To give itself breathing room, Gibson has sold, or is selling, a number of properties in Memphis and Nashville.
A senior credit officer at Moody's Investors Service last week told Nashville Post Gibson is "running out of time — rapidly."
$375 million of secured notes will mature in a matter of months. If they are not refinanced by July 23, another $145 million in bank loans will become due, the Post reports.