PRIVATE EQUITY OWNED
Guitar Center
Includes GuitarCenter, GC
musical instruments · Westlake Village, CA
- PE Firm
- Ares Management
- Year Acquired
- 2021
Bain loaded it with $1.6 billion in debt. Ares inherited the wreckage.
The PE Playbook
- Bain Capital bought Guitar Center in 2007 and saddled it with $1.6B in debt — a $650M term loan, $750M in notes, and a $375M credit facility
- Filed Chapter 11 in November 2020, eliminating ~$800M in debt; cycled through three CEOs under PE ownership
- Corporate layoffs hit ~180 employees in internal waves, gutting institutional knowledge and customer service quality
- Defaulted on a $45 million interest payment in October 2020 — the debt bill, not the pandemic, is what finally tipped it into bankruptcy
Since the Acquisition
- Went bankrupt in November 2020 — staffing was already gutted and stores had shifted from professional-grade gear to entry-level inventory long before the filing
- Retail staffing cut so deeply that employees report one person now does the work of 3-4 people
- Professional-grade gear inventory gutted — stores now primarily stock entry-level equipment instead of pro-level instruments
- Two California locations closed in January 2025 with 62 employees laid off
Sources
- Guitar Center shutting down locations and laying off workers — Taste of Country(2025-02-01)
- How Guitar Center went from jukebox hero to bankruptcy — Retail Dive(2020-11-23)
- Private equity keeps stabbing Guitar Center — 5 Mag(2020-11-22)
- What Does Guitar Center Bankruptcy Mean? — Rolling Stone(2020-11-22)