News
Guitar Center sold
Andy Barrett Jun 27 2007, 5:45pm
Biggest MI retailer in the world sold for $2.1 billion
Guitar Center has been sold by auction to a private investment company, Bain Capital Partners, for $2.1 billion.
Rumours abounded in early June that Goldman Sachs had been called in for an evaluation and to organise an auction for the cash rich company, but the lack of confirmation or denial soon dampened talk.
"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,” commented GC’s CEO, Marty Albertson. The Guitar Center board was acting upon the advice of a special committee of independent directors and has now recommended that all shareholders accept the deal.
Shareholders will receive $63 per share in the deal, which will be more than tempting, as after the purchase was announced, Guitar Center shares jumped a further $9.23 to $59.29 from the closing price on Tuesday evening (June 26th).
What Bain’s intentions are with the MI giant is yet to be revealed, but the company has global assets worth around $50 billion under its management. With names such as Toys R Us, Burger King, and the Warner Music Group included in those, it would appear that a fast sell off is not Bain’s primary motivation for the sale.
