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Discussion in 'Miscellaneous [BG]' started by Spent, Mar 4, 2014.
Bad news for Guitar Center.
THIS is the key portion of that story:
"Here’s the situation. Guitar Center has amassed some US$1.6 billion in debt, 'much of it stemming from Bain’s $2.1 billion leveraged buyout of the company in 2007,' according to the Wall Street Journal. The talks would convert that debt into ownership by the creditor."
"Note the numbers there. A large portion of the debt in Guitar Center came from the original, highly-leveraged buyout. In other words, you may be able to draw more conclusions about Bain from what’s happened than you would about the music instruments industry or big box retail in general."
These buyouts are unnecessary and EVIL. They load companies down with excess debt, then the creditor milks them and dumps them, often closing them down and putting employees on the street.
I'm not against businesses acquiring each other when it makes financial sense, but too often, these leveraged buyouts are nothing more than an effort to suck the life out of the company acquired.
Exactly. Too often this is done at the expense of employees, without whom the business would crumble. Vulture capitalism at its finest.
Somebody at Bain Capitol will walk away with a lot of money. GC employees will walk away looking for jobs somewhere else. Bain has a long history of this kind of stuff.
All true exept it's already happened. Bain gets their profit up front.
Whassamatter? Don't ya like the Free Market System?
BlackRock ate my semiconductor job.
Free market, yes. Fraud market, no.
This is actually old news. GC has been in financial trouble for several years. Staples is also owned by Bain Capital and is also struggling. The upper management at Bain will end up making huge money on a buyout while many employees will lose their jobs.
Yes, but the article is new.
It was a trick question. There is no such thing as a free market.
According to an email from our CEO, there are big, positive announcements coming in the next few weeks regarding this. We will see what happens. Pretty old news for the most part, though. I have a backup job so I'm not really worried.