News for the quiet bunch.

[skyboltone]

Sure is a quiet bunch tonight......Guitar Center just sold for $1,900,000,000.

I'm personally trying to put them out of business. I've never spent a nickle there.

DanH

[jimipage]

who bought 'em? the chinese? (i'm serious)

[skyboltone]

who bought 'em? the chinese? (i'm serious)

June 27 (Bloomberg) -- Guitar Center Inc., the largest U.S. retailer of musical instruments, agreed to be bought by Bain Capital Partners LLC for $1.9 billion.

Bain will pay $63 a share in cash, Guitar Center said today in a statement, 26 percent more than the stock's closing price yesterday. The buyout firm will also assume Guitar Center's debt, bringing the total transaction value to $2.1 billion.

Guitar Center sells Fender guitars, Pearl drums and Yamaha keyboards at more than 210 U.S. stores and online. Bain was part of a group that agreed last week to buy Home Depot Inc.'s contractor-supply unit for $10.3 billion, and has also invested in retailers Toys ``R'' Us Inc. and Michaels Stores Inc.

``They are the market leader in the musical instruments business,'' said Joan Storms, an analyst at Wedbush Morgan Securities in Los Angeles who rates the shares ``hold.'' ``They put mom-and-pops out of business when they come into town.''
Guitar Center reported revenue gains of at least 12 percent every quarter since 1998. Sales climbed 14 percent to $2.03 billion last year, a sixfold increase since the company went public in 1997.

The shares jumped $9.92, or 20 percent, to $59.98 at 4 p.m. New York time in Nasdaq Stock Market composite trading. The stock has almost quadrupled since its initial share sale at $15.

Guitar Center began in 1959 when former car salesman Wayne Mitchell purchased a small appliance and organ store in Hollywood, California. In 1964, Mitchell converted a movie theater next door and opened the first Guitar Center on Sunset Boulevard.

RockWalk

The company operates the Hollywood RockWalk in front of its store on Sunset. The monument features cemented handprints and plaques honoring influential rock musicians such as John Lennon and Jimi Hendrix and instrument makers including Les Paul.

Competitors include Sam Ash Music Corp., which operates 45 U.S. stores.

Guitar Center is bigger than its competitors, making it unlikely a rival could have bought them, said Thierry Wuilloud, who helps manage $2.7 billion at Becker Capital Management in Portland, Oregon.

``It's a reasonable transaction,'' Wuilloud said. ``They have a differentiated business model and strong market share.'' Becker Capital held 306,516 Guitar Center shares, a 1 percent stake, as of March.

Acquisitions

Guitar Center bought bankrupt band and orchestra-instrument retailer The Woodwind & The Brasswind for about $30 million in February. In 2005 it paid $90 million for closely held Music & Arts Center, which sells and rents oboes, trumpets and other school-band instruments to students and teachers.

Music & Arts, which has more than 95 stores, may be sold after the transaction is complete, according to Gary Balter, an analyst at Credit Suisse Group in New York.

``Guitar Center seems like the perfect'' company for a buyout, Balter wrote today in a research note. ``They have a dominant retail position in a high service business yet significantly under-earn other high service oriented retail.'' He rates the shares ``neutral.''

Guitar Center's board approved the purchase and recommended stockholders back the deal. Bain and Guitar Center expect the purchase to close in the fourth quarter.

[jimipage]

thanks for posting that, skyboltone

[David Root]

Scary stuff alright. Is Fender still on the block or did some suits pick them up too?