Guitar Center is expected to file for bankruptcy, but that doesn't signal the end for the world's leading musical instrument retailer. The move is part of a Restructuring Support Agreement (RSA), which will afford the company financial flexibility as they seek to not only remain open, but return to a point of growth, despite currently being $1.3 billion in debt, a figure noted by Forbes.

“Today we announced a very important and positive step forward to ensure the long-term financial strength of Guitar Center," began Guitar Center CEO Ron Japinga in a statement released on Nov. 13 (via BusinessWire).

The CEO continued, "This agreement will allow us to significantly reduce our debt and reinvest in our business in order to better serve our customers and deliver on our mission of putting more music in the world. With 10 consecutive quarters of growth prior to the impact from COVID-19, we have been pleased with our resilient financial performance during these challenging times created by the pandemic."

Looking forward, Japinga added, "As a result of this financial restructuring process, we will be better equipped to execute on and invest in our strategic growth initiatives and we will continue delivering through the strength of our brands, availability of our stores, customer-focused associate relationships, innovative music education programs and our expanding digital solutions."

For the consumer, not much is expected to change. It has been noted that the company will continue to provide "uninterrupted service" through all current channels of operation amid the expectation of filing for bankruptcy as part of the restructuring plan. This is expected to be completed before the end of the year.

For more details on the financial aspects behind RSA, head here.

In late October, it was reported that Guitar Center missed an interest payment of $45 million, setting the expectation that bankruptcy was inevitable.

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