Onkyo Corporation had a really tough fiscal 2020 – the fiscal year that ended March 31, 2020. How tough was it? So tough that the company was forced to announce that a massive drop in revenues and record losses had pushed the company into insolvency – calling into question its ability to continue as a going concern. It doesn’t get much tougher than that. And this announcement triggered a Tokyo Stock Exchange action – invoking a rule that starts a clock on a limited grace period for the company to cure the situation – their insolvency – before a forced delisting from the JASDAQ stock exchange is implemented.
As you most likely know by now, Onkyo Corp. and Sound United have called off their transaction which would have transferred ownership of the 73-year old Onkyo brand, as well as the Integra, Pioneer, and Pioneer Elite brands to Sound United. The shocking news capped off a nearly five month process where many in the industry tried to figure out just how this deal made sense.
This was the second loss of a potential buyer for Onkyo, which admits it is re-evaluating its future based on the failure to sell off its brands.
See why Onkyo’s future is a question mark…[Read more…] about With Loss of Two Potential Buyers, Onkyo’s Future is a Question Mark
We seem to be in a week of big deals. First, we learned that SnapAV had acquired Control4, then we learned that the original founder of Paradigm has acquired back the Paradigm, Anthem, and Martin Logan brands from the private equity company that had bought the company from him some time back. Now we learn that Sound United, owner of Denon, Marantz, Polk Audio, Definitive Technology, HEOS, Classé, and Boston Acoustics has entered into an agreement with Onkyo Corp. to purchase Onkyo’s premier lineup of brands, including: Onkyo, Integra, Pioneer and Pioneer Elite.
But does Sound United’s purchase of Onkyo make sense?…[Read more…] about Sound United to Acquire Onkyo’s Audio Division
I have to admit, Strata-gee was considering moving on from its Gibson Brands (Gibson Guitar) coverage, first started in 2012 when the company made several acquisitions as part of an ill-advised foray into the consumer electronics business. As delineated in our copious coverage, Gibson CEO Henry Juszkiewicz turned to OPM (other people’s money) loading the company up with over half a billion dollars in debt to pursue a business in which the company had no expertise…ultimately resulting in Gibson’s bankruptcy filing in May of this year.
Gibson’s major creditors banded together, put together what some would call a pre-packaged bankruptcy plan and looked as though they would exit bankruptcy late November/early December. They were wrong. As they tried to power out of bankruptcy, they hit a brick wall – the United States Trustee who has filed a serious objection to their motion to exit bankruptcy.
Now what? See what the U.S. Trustee objects to in Gibson’s plans… [Read more…] about Gibson’s Speedy Bankruptcy Exit Hits a Big Roadblock
Just a matter of months ago, Gibson Brands management assured the town elders of Memphis, TN that the company remained committed to the vibrant music community in Memphis and that they were looking for new digs somewhere within that community. But that was then and this is now – the company was basically taken over by KKR and now the company has decided to vacate Memphis, moving their group there to Nashville.
See more on the incredible shrinking Gibson… [Read more…] about Gibson Says, Sorry Memphis, We’re Outta Here
With Old Debt Gone, A New Leader & Team Arrives
Gibson Brands is on the verge of emerging from bankruptcy a much healthier business in many respects – with less debt, more money in the bank, and a new leader to help the company shed its consumer electronics debacle and reconnect with the musical instrument market. The fifth time, it appears, was a charm as the court has approved the fifth revision of a company submitted turnaround plan that, cuts debt, jettisons former CEO Henry Juszkiewicz, and puts bondholders KKR in the driver’s seat.
See more on Gibson’s dramatic turnaround… [Read more…] about Gibson to Emerge from Bankruptcy & Stop Singing the Blues
Gibson Brands’ Chapter 11 bankruptcy proceedings have continued to incessantly march forward, the gritty work of a large scale matter such as this occurring mostly in the background. However, occasionally a major factor emerges to be picked up by the media. One thing the new owners of Gibson made a fundamental part of this initiative, was to change the organization’s leadership.
This week, we learned that the company will soon emerge from bankruptcy with a new chief financial officer (CFO) – announcing the appointment of Kimberly Mattoon for the role.
See more on this Gibson news… [Read more…] about Gibson Begins Leadership Makeover w/New CFO
News of Gibson’s $10M Monthly Loss Gives Some Pause
Gibson Brands, Inc. declared bankruptcy on May 1, 2018, thereby placing themselves in Chapter 11 protection from creditors. Now under the guidance of bankruptcy court, the company buys itself time to put a plan together to present to the judge offering a path out of bankruptcy for the company. During this time, debts are frozen until the judge determines the final disposition – a disposition that typically includes some level of payment to debtors, both secured and unsecured.
So how is Gibson doing? According to a story by the Nashville Post, Gibson posted a loss of nearly $10 million in May – its first month under bankruptcy court protection from creditors.
See more on the bumpy bankruptcy road upon which Gibson finds itself… [Read more…] about Gibson, Protected from Creditors, Still Loses Money
In Restructuring, Company Scales Back to ‘Core Competencies’
All the way back in 2012, Onkyo Corp. and Gibson Guitar Corp. came together to partner in what both hoped would become an entity where the whole was greater than the sum of the parts. Just months after their announcement, Onkyo forged ties to another Japanese audio brand, Teac/Tascam – just as Gibson stepped in to buy a majority share of them…and the combined entity began to grow.
Little did they know that just six short years later, Gibson, the investor in Onkyo, would implode into bankruptcy – forced to extricate itself from its Onkyo aspirations. Onkyo was hit as well, losing its Gibson investment – forcing them to reassess their direction. We now learn that Onkyo has sold off its entire European operations to an accessory distributor known as Aqipa GmbH.
See more on this surprising announcement by Onkyo… [Read more…] about Gibson Investment Gone, Onkyo Sells Off European Operations
Gibson, as Strata-gee previously reported, filed for bankruptcy protection on May 1st in a pre-negotiated package with principal noteholders of the company’s substantial debt – debt that was now in default. But while that deal suggested a smooth path for the case through the bankruptcy court, it did not take into account the position of unsecured creditors, and especially Philips who describes itself as the largest unsecured creditor in the matter.