Guitar Center completes Musician's Friend deal
Musician's Friend and Guitar Center announced the completion of their merger Tuesday, a deal that creates the largest multi-channel retailer of musical instruments in the world.
Guitar Center, based in Agoura Hills, Calif., paid $48.3 million in stock and assumed debt for Musician's Friend. The merger was announced in mid-May.
Guitar Center, which trades on the New York Stock Exchange at GTRC, issued 1,959,970 new shares, valued at $15.25 a share based on Friday's closing price, to Musician's Friend shareholders. It also assumed $18.4 million of Musician's Friend's debt. The stock's price was unchanged when trading closed Tuesday.
The deal allows Musician's Friend to continue growing and gives Guitar Center the strong mail-order partner it had been looking for.
The two companies sell musical instruments in retail stores, by mail and over the Internet. Guitar Center did $391.7 million in sales last year, while Musician's Friend did $97 million. Guitar Center will add Musician's Friend's nine stores to its 52 nationwide; the combined company has a mailing list of 4 million customers.