Fender hopes to raise about $200 million from the offering, and will use it to pay down it's debt load of about $242 million, and hopefully mean a payday for it's biggest investors; private investment firm Winston Presidio owns 43%, and Japanese distributor Yamano Music holds a 14% stake in the company. The estate of Fender's savior Bill Shultz owns 6%.
Fender president Shultz saved the company from almost certain death by arranging for a seat-of-the-pants buyout from CBS in 1984. CBS had bought it from Leo Fender in 1965 and proceeded to run the company into the ground, by changing some of the great products that they had (they thought they were "improving" them), introducing some ill-fated new ones, and having some very poor quality control. Shultz and a group of investors bought only the Fender name, the patents, and some leftover parts, and basically started the company over again from scratch since none of the buildings or equipment was part of the deal.
I remember going to the very small (maybe 30 people) celebration party in a small Anaheim hotel room during the 1985 NAMM show. I happened to get to talking to a visibly nervous and unsure Shultz.
"Do you think we can make it?", he asked.
"Of course you will. You're Fender. People want you to succeed," I replied.
"I hope you're right," came the not-too-confident reply.
Bill lived long enough (he died in 2006) to see Fender restored to it's former heights and beyond, way beyond. I'm not entirely sure he'd be pleased that the company will no longer be privately controlled, but I bet he'd be thrilled that the company has grown enough in stature to be respected by Wall Street. Let's hope that the IPO doesn't change Fender the way CBS did.
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