Guitar Center Inc. has been cleared to exit bankruptcy with a plan to cut about $800 million in debt and provide the nation’s largest seller of musical instruments with an infusion of cash to navigate the pandemic and holiday shopping season, WSJ Pro Bankruptcy reported. Judge Kevin Huennekens of the U.S. Bankruptcy Court in Richmond, Va., said yesterday that he would confirm Guitar Center’s prepackaged chapter 11 plan, paving the retailer’s path to get in and out of bankruptcy in less than a month. Guitar Center, which entered chapter 11 with more than $1.3 billion in debt, anticipates emerging from bankruptcy as soon as next week, a company lawyer said. Guitar Center’s plan is backed by shareholder Ares Management LLC and co-investors Brigade Capital Management LP, one of the company’s largest bondholders, and the Carlyle Group. Together they agreed to inject $165 million in equity investment into the Westlake Village, Calif., retailer and will own the business after its emergence from bankruptcy.
