We’ve written about the continuing saga of Gibson Brands numerous times, most recently when they filed Chapter 11. As has been the case with many major companies in decline, Gibson financed a buying spree of companies with massive debt—and now it’s unable to even service that debt.
In the latest episodes of this soap opera, the company has finally begun a search for a replacement for longtime CEO Henry Juszkiewicz. Juszkiewicz’s wholesale purchases of dozens of consumer electronics companies were the cause of the company’s massive debt-load, and his firing was demanded by creditors.
In just the last week, Gibson has sought to dismiss a $50 million lawsuit brought against them by one of their suppliers. Tronical is a German company that developed an auto-tuning technology that Gibson first adopted in 2007; Tronical is suing for breach of contract and unpaid profits from units sold. Press reports of Gibson’s efforts to dismiss have somehow inflated the amount of Tronical’s action to $60 million. At this point, who knows what’s correct?
And finally, just a few days ago Gibson announced their 2019 lineup of guitar models. The number of models has been drastically reduced, compared to the offerings of the last few years.
It will be interesting to follow the progress of reorganization efforts as electronics companies are sold off, a new CEO is found, and the company addresses criticisms of dismal product quality. There will undoubtedly be more twists and turns in the months to come.