Guitar Center downgraded again on new refinancing plan

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Guitar Center downgraded again on new refinancing plan

Guitar Center, like so many distressed retailers before it, is doing its best to kick debt down the road.

Guitar Center's proposed debt exchange would constitute a default: Moody's

Moody's Investors Service downgraded its probability of default rating on Guitar Center Inc.'s debt to Ca-PD from Caa1-PD, and said that if an exchange offer announced earlier this week goes through, it will constitute a distressed exchange, and event of default.

Guitar Center’s $1 billion in debt reveals this truth about musical tastes

Guitar Center, the nation’s leading musical-instrument retailer, is in trouble. Changing musical tastes are partly to blame.

Radio stopped playing guitar rock bands, schools cut music education, guitar companies priced their products out of the market, Millennials want instant gratification and are not willing to study music, etc..,  Some have speculated the downturn in guitar sales is because of the economic downturn for the working and middle classes who can't afford to buy their kids expensive instruments and take lessons.  But then again, the kids today can afford expensive smartphones so they could afford used instruments and DIY tutorial books.  Guitar Center has some really nice selections at their stores, hopefully they will pull through.

There are many reasons you can blame for Guitar Center's predicament, but there are other stores that are doing well such as Sweetwater Sound and perhaps privately owned Sam Ash Music.