Hold on to your Gibby's, they will become known as "Pre-Fender Gibsons"

[DanvillRob]

wait a sec guys!!

what are you talking about here??

can someone give me the story in a nut shell? whats happening with Gibson ? is there any actual danger of shutting down the whole thing or selling it to a major corp?

 

 

Yeah.... they're toast...requiring ALL Gibsons to be returned to Kalamazoo unless the owner lives in North America or Europe...where are you? Oh... wait...Israel? Nevermind!l

[drathbun]

Yeah.... they're toast...requiring ALL Gibsons to be returned to Kalamazoo unless the owner lives in North America or Europe...where are you? Oh... wait...Israel? Nevermind!l

 

Change your handle to DanevilRob!

 

It is all speculation at this point. I'll wait for the official announcement that Yamaha is taking over Gibson. hehe...

[DanvillRob]

Change your handle to DanevilRob!

 

It is all speculation at this point. I'll wait for the official announcement that Yamaha is taking over Gibson. hehe...

 

 

It's one thing to have Gibson taken over by Yamaha...but worse, it's their lawnmower division!!

[bkharmony]

In all seriousness, you know what I'd like? For Gibson to sell off Epiphone. The two of them competing against each other again could produce some fine guitars!

[Red 333]

I pointed out on another thread that it doesn't even make sense that Gibson would be for sale anyway.

 

The rap on Gibson is that they haven't provided their lenders/investers with the certified audited finacials that are due as part of their loan agreements, only estimates. Well, what company in their right mind is going to buy Gibson when they can't examine the books to see how healthy or sickly it actually is, and what they're getting for their money.

 

I have no way of knowing, and hope not to end up with egg on my face, but from what I do know, I think all this sale talk is much ado about nothing.

 

Red 333

[Guth]

And correct me if I'm wrong' date=' as I don't have it in front of me, but I don't think that article or any other trusted source said Gibson had defaulted on any debt. If I remember, the source of all this agita is that they haven't provided their lenders the reporting due as part of their lending agreements. True, the lack of reporting (and the Chief Finacial Officer roulette that's said to be its cause) is not a good sign, but it's the defaulting on the debt itself (not the reporting) that's apocalyptic. [/quote']

 

Perhaps someone with a financial background (it wouldn't take much to better my understanding) can better explain the current situation. I believe that you were referring to the part of the article that mentioned that by failing to report audited financials (for 2008), Gibson has violated the terms of a $150 millon loan that it had received from one lender. It also said that it was expected to breach a financial performance covenent for 2009's results. Also, one of the sources of the article mentioned that Gibson thus far had failed to cure the default (which would seem to indicate that they had indeed defaulted on a loan).

 

It sounds to me as if Gibson is not playing by the lender's rules, and hasn't been for quite some time now and is failing to pay off it's debts in the manner to which they had agreed — which can't be a good thing. Furthermore, the article went on to state that the only thing keeping lenders from accelerating the debt was the value Gibson provides as a brand. If they choose to enforce their rules and collect their money from Gibson, causing the company even more problems, then the value of that brand begins to drop even more — somewhat of a Catch-22 situation from the lender's standpoint

 

After reading the article in question, I can see why some people would be concerned.

 

All the best,

Guth

[Guth]

I pointed out on another thread that it doesn't even make sense that Gibson would be for sale anyway.

 

I didn't see anything in the article that would make me think Gibson (as a whole) was going to be sold.

 

However, it was noted that unless they are soon able to pay up on what they owe, they might be getting close to the point where they would be forced to restructure, which I would take to mean that they might need to sell off some of the company (perhaps some of the other brands that Gibson owns, but not Gibson itself?).

 

All the best,

Guth

[Red 333]

Also' date=' one of the sources of the article mentioned that Gibson thus far had failed to cure the default (which would seem to indicate that they had indeed defaulted on a loan...[/quote']

 

I believe the article says Gibson has defaulted on the reporting requirement, not the loan.

 

The article also said Gibson had a relatively light debt ratio, and had produced outstanding results in 2009, considering the state of the economy.

 

Lets hope so.

 

Red 333

[Guth]

I agree. All these folks saying you have to look and look to find that one-in-one hundred that doesn't suck are beyond mental.

 

Well, everyone is certainly entitled to their own opinion.

 

Sometimes where you stand on an issue depends on your point of reference. I've known folks that are plenty happy with their all laminate guitars — they think their guitars sound absolutely fantastic. Just about any name-brand guitar is going to sound stellar to their ears. As long as they're happy with their own guitars, it really doesn't matter.

 

Some people are perfectly content listening to mp3s via cheap earbuds, while others spend much, much more on stereo gear for playback that meets a higher standard. The second group might not get any more enjoyment out of their experience than the first group, but they can certainly tell the difference between the two experiences, while the first group might not. It's all relative.

 

It really is all about enjoying the music, wether it be making it or simply listening to it. However, there is some truth to the adage that ignorance is bliss.

 

If you've never played/heard a number of Gibsons that were dogs, then more power to you.

 

There was a thread the other day where someone was inquiring about recommended guitar modifications. I tend to agree with the person that posted something to the effect of "play as many as you can until you find the guitar that sounds truly great just the way it is". If you can find a way to make a guitar sound better, well bonus. But I prefer to start at the point of sounding great from the beginning, and any advancement beyond that is just icing on top of the icing that already existed.

 

To my ears, Gibson makes some stellar guitars and they make some less than desirable sounding guitars. The problem as I see it is that they are less consistent when it comes to building guitars with a uniform tone as compared to other manufacturers. There might be a Gibson out there for just about anyone looking for one, but that can represent wildly differing points along the tonal spectrum.

 

Guth

[Guth]

I believe the article says Gibson has defaulted on the reporting requirement' date=' not the loan.

 

The article also said Gibson had a relatively light debt ratio, and had produced outstanding results in 2009, considering the state of the economy.

 

Lets hope so.[/quote']

 

I believe that you're correct, I went back and did a search on the article for default and found later where they referred to a "reporting default". That said, if they have failed to report their financials for the past few years, how would anyone know that they have a light debt ratio or produced outstanding results in 2009?

 

Like I said, I have no background in this area so I'm not trying to be a wiseguy. Only trying to get a better grasp of what the article really means. From my rather "financially ignorant" perspective, things probably seem worse than they are.

 

Appreciate the insight.

 

Guth

[bkharmony]

Well' date=' everyone is certainly entitled to their own opinion.

 

Sometimes where you stand on an issue depends on your point of reference. I've known folks that are plenty happy with their all laminate guitars — they think their guitars sound absolutely fantastic. Just about any name-brand guitar is going to sound stellar to their ears. As long as they're happy with their own guitars, it really doesn't matter. [/quote']

 

I was wondering when someone would come along and say (or hint) that my ears that are defective. I'm surprised it took this long, but then again, this is a pretty laid-back, unassuming bunch for the most part.

 

I guess I'm just sniffing' the cork wrong. Maybe if I start a thread on AGF they can explain to me how it is I'm hearing all these awesome guitars the wrong way.

[thabesh]

it seems fairly straight forward that (1) Gibson has defaulted on a loan covanent by not providing audited financials to the lender by the stated due date, (2) they apparently have not cured this within the default cure period by providing said financials, (3) the lender then has recourse under whatever the terms of the loan agreement are to seek immediate repayment whatever the loaned amount may be (small or large), and (4) the big enchilada to the lenders would be that even though the loan is in default, cash is going out the door in the form of dividends to shareholder's. Gee, I wonder who might be siphoning cash off of the corporation and thumbing his nose to his lender at the same time. Bad business boys - bad business.

[lespaulj45]

Whatever happens I know that I have two Gibson guitars (2006 desert burst Les Paul Std and a J-45 triburst) with a tube amp full of 12AX7's and the rest of my guitars and amps are filler...I have all the string glamor i need

[Paul E]

I find the thread pretty interesting, trying to look into a cloudy crystal ball and predict the future. Well I'm happy with what I have and probably wouldn't buy another one (maybe).

[Murph]

What will the Jonas Brothers do?

 

[fortyearspickn]

I've some experience in providing lenders, investers and the govt with 'required financial results reporting'. Half the time they make it impossible to get them everything they want in the timeframe they want it. This lender figures they can put pressure on Gibson by getting an idjit financial reporter (there's an oxymoron) to put out an article claiming bad things. Privately held companies don't have SEC reporting hoops to jump through so the lenders come up with their own stuff and then ask for more. I am certain Gibson has an independent financially certified audit every year and that, plus the fact they have a low deb ratio and are making their payments is all that should matter to the lender. Except his bruised ego is affecting his thinking - and the liklihood Gison will re-finance with him again. All guitar players should care about is the quality of the guitars being made. If you want to invest - I suggest precious metals, not guitars.

[Guth]

I was wondering when someone would come along and say (or hint) that my ears that are defective. I'm surprised it took this long' date=' but then again, this is a pretty laid-back, unassuming bunch for the most part.

 

I guess I'm just sniffing' the cork wrong. Maybe if I start a thread on AGF they can explain to me how it is I'm hearing all these awesome guitars the wrong way.[/quote']

 

Like I said, everyone is entitled to their own opinion. I'm not slinging obscenities, nor calling others names. I don't think that only one in one hundred Gibsons doesn't sound like crap, but I also don't think that all Gibsons sound fantastic - there's just too much variation from one example to the next. My point of reference: actually playing the guitars. The past few years I've lived near a 5-star Gibson Acoustic dealer. I've been able to play a very large amount of Gibsons during that time, (it's not difficult for me to compare 5 or more slope shouldered models at once, or 5 or more square shouldered models, or multiple jumbos, etc.). At any given time It's not hard to find one or two Gibsons that stand out amongst all the others and a few that are dogs. When I lived in Texas I drove to Houston just to visit Fullers so that I could actually play the guitars. Same story there. I would never buy a guitar without first being able to play it, unless the seller offered a good return policy. I wouldn't just apply this to Gibson, but to any factory built guitar.

 

Since 1991 I've owned four Bozeman-made Gibsons in total, but I've played far, far more that I wouldn't spend my money on - a lot of them sounded really good, and many of them sounded okay, but far from great. Others truly sounded horrible. Eventually all of them found a buyer (even the ones that sound like they were strung with rubber bands). Look, I love my Gibson — it's one of the best sounding guitars I've ever owned, but I'm certainly not drinking the Kool-Aid. Based on my experiences, Gibson is making some truly great acoustics, and more than a few that would drive a person to invest in Tonerite. Not everyone is looking for the same "tone", but Gibson must have one of the most varied group of customers when it comes to this aspect of acoustic guitars.

 

Guth

[Guth]

I am certain Gibson has an independent financially certified audit every year and that' date=' plus the fact they have a low deb ratio and are making their payments is all that should matter to the lender.[/quote']

 

So more than likely Gibson is providing the lender with independent audit results (indicating things like their actual debt ratio), but just not providing all of the details that the lender is asking for?

 

Thanks,

Guth

[Eddie Rondack]

Hi folks-

 

Those that love Gibsons, love them. Those that don't, don't... funny how that works.

 

I've had a bunch of Gibsons over the years, occasionally selling them to get another Gibson. You know what the best thing about Gibsons is? They look and sound like... GIBSONS!

 

The Gibson sound is unmistakeable, individual, unique and un-reproducible (is that a word?) I don't know why, it just is. I've played some Collings and Bourgeois copies and they're great... but they're not the real thing.

 

I also see tons of posts around all the forums talking about who has the best burst... is there really any doubt? Gibson blows all the pretenders away! Any other brand with a burst just doesn't look right to me... they all look like copies... some are good, but none are the real deal.

 

The point of all this is that the demand for authentic Gibsons will survive, so I believe the company will. I've bought many sight unseen and only been disappointed once... the consistency is just as good as any other guitar maker out there... and that conclusion is based on experience with many of them. I've sent back Collings, Bourgeois, etc. because they weren't what they were supposed to be... they're human too, believe it or not.

 

The bottom line is that the marketing strategy and the financials might be effed up but the heart of the brand is in the hearts of the folks that make them... and that will survive. It might be hard to find for a while if something happens (Norlin), but it will come back because it's what people want and it has a special, unique place in our hearts and in the heart of the USA.

 

And that's all I have to say about that.

[BigKahune]

... ...the demand for authentic Gibsons will survive' date=' so I believe the company will. ... The bottom line is that ... the brand is in the hearts of the folks that make them... and that will survive. ...[/quote']

 

Yes, I'm sure the same was said about the once great Epiphone company, now reduced to Gibson's "B" line. And the once full-line Guild company, now stripped of its once well respected electric and hollow-body lines by Fender.

 

Yep, the Gibson brand will probably survive, but what will be left of it if a take over occurs? Would the new owners turn it into a "B" line? Would the new owners drop whole lines from the Gibson catalog?

 

Scary thoughts. I'm thinking/hoping Gibson will continue to maintain viability on it's own, without a take over by another brand.

[fortyearspickn]

Guth, in a word "yes". I'm sure Gibon has provided their lender audited financials. Would we provide Country Wide Financial a report every month of how much we spent on "take out"? That's the kind of bs that these lender expect: They assume a small, privately held corporation should spend thousands of $ tryng to figure out just for them how much Ren spent at lunch over the past year entertaining Sam Ash buyers instead of spending that money on staff or materials. Don't let a single financial weenie make you think a corporation has problems because his/her ego was damaged when they wouldn't tell him why they chose to work with Sam Ash as opposed to Mom & Potash.

Let your ear make the decision.

[QuestionMark]

Seems to me, Henry has been quite a smart businessman and guitar manufacturer since day 1 of his involvement with Gibson. I'm pretty sure that will continue although these are rough times for most companies. In my opinion, if nothing else, Henry now has a whole slew of brands other than Gibson in the company conglomerate that he can sell-off and raise cash with, if needed, to get through these times to preserve the valuable core brand of Gibson that the entire company conglomerate of brands is built around. I wouldn't worry about Gibson or Henry going under.

 

Just wanted to share my thoughts and observations on the subject.

 

QM aka Jazzman jeff

[fretplay]

I'm never sure about these resale value things, it seems when you want to buy its ' rare and everone wants them' and when you want to sell 'no one wants these old guitars anymore'

 

I have a 1975 Gibson J45 I was once offered £2000 ( about 3000usd ) for it, and it turned out the buyer didn't play.

Now I hear 70s Gibsons are rubush, ah well! I still have it and it plays great. Who knows!!

[onewilyfool]

I think, no matter how much Henry can "song and dance" around things, one day he will have to open the books to his lenders. If the company is in trouble, the lenders can apply a LOT of pressure. Force a re-structuring, force a sale, become partners at very favorable stock exchange..... etc. etc. It's not over yet....Did anyone hear what came of that "illegal" wood importing challenge that Gibson had a while ago???

[Red 333]

Did anyone hear what came of that "illegal" wood importing challenge that Gibson had a while ago???

 

I don't know how accurate this, but I read the investigation was dropped.

 

Red 333