Article on the Cordoba Takeover in the New Issue of Music Trade

jeffcoop

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Mid-month sounds like a plausible closing date, but the 15th is a Sunday, which sounds a bit unusual to me.But then, I don't buy or sell businesses.
 

Synchro

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Synchro is secretly the Cordoba CEO. Was, really...he just blew his cover.
Sorry gentlemen. Now I'll have to confiscate all of your Guilds. In return, you'll get a 10% discount coupon good for any CMG product. :)
Are you saying you have seen that as the date for the sale to occur? Have I missed something?
The inside rep at FMIC said the sale was effective the 15th. That's all I've heard.

Mid-month sounds like a plausible closing date, but the 15th is a Sunday, which sounds a bit unusual to me.But then, I don't buy or sell businesses.
It's probably already signed to take effect on that date. Maybe having it take effect on a Sunday has the effect of freezing business so that they can isolate a trial balance of all inventory at the time of the sale. Just a theory.
 
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adorshki

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Sorry gentlemen. Now I'll have to confiscate all of your Guilds. In return, you'll get a 10% discount coupon good for any CMG product. :)
The inside rep at FMIC said the sale was effective the 15th. That's all I've heard.
It's probably already signed to take effect on that date. Maybe having it take effect on a Sunday has the effect of freezing business so that they can isolate a trial balance of all inventory at the time of the sale. Just a theory.
Yeah, usually the interval until signatures take effect is just to give all parties time to do their discovery and due diligence, kind of like when a house is in escrow.
You might be right about that Sunday thing, it might very well be a convenient day of the week to get a 100% up-to-date "snapshot" of the books as of close of business Saturday, without worrying about having to factor in a regular business day's business, later.
So I'm sure all parties are dealing in good faith and it probably IS a "done deal" as someone (Ralf, I think) mentioned, but still..."it ain't over 'til it's over".
 

ladytexan

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According to an anonymous source who would know, the tooling, machinery (including the heat laminator), wood inventory, and all remaining "A" stock (after the fire sale) went to CMG in California (not sure it is was Oxnard). Factory was 'officially' vacated on June 1st.
 
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Synchro

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Yeah, usually the interval until signatures take effect is just to give all parties time to do their discovery and due diligence, kind of like when a house is in escrow.
You might be right about that Sunday thing, it might very well be a convenient day of the week to get a 100% up-to-date "snapshot" of the books as of close of business Saturday, without worrying about having to factor in a regular business day's business, later.
So I'm sure all parties are dealing in good faith and it probably IS a "done deal" as someone (Ralf, I think) mentioned, but still..."it ain't over 'til it's over".
It ain't done til it's done, but it sounds like both parties have committed to this 100%. As LadyTexan mentions (below) they've moved a lot of material and equipment. I get the feeling that CMG is very serious about making this happen.
According to an anonymous source who would know, the tooling, machinery (including the heat laminator), wood inventory, and all remaining "A" stock (after the fire sale) went to CMG in California (not sure it is was Oxnard). Factory was 'officially' vacated on June 1st.
Someone had to pay for all of this moving, so I'd say that is a clear indication that this is going to happen.

I hope the CMG has the sense not to mess with prices and is smart enough to realize that they have purchased something viable and profitable as is, without any radical changes in approach to business.
 

SFIV1967

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So I'm sure all parties are dealing in good faith and it probably IS a "done deal" as someone (Ralf, I think) mentioned, but still..."it ain't over 'til it's over".
Al: You are not driving me crazy but it was not me. I was the one saying it is not a done deal until I see the official press release about the closure...and so far only a letter of intent was signed. (and I referred to legal language). Now that was a month ago...
And yes, the article Sandy shared has some errors in it...Hope CMG does a bit more research about the company they acquired...
Ralf
 
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Synchro

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Al: You are not driving me crazy but it was not me. I was the one saying it is not a done deal until I see the official press release about the closure...and so far only a letter of intent was signed. (and I referred to legal language). Now that was a month ago...
And yes, the article Sandy shared has some errors in it...Hope CMG does a bit more research about the company they acquired...
Ralf

True, but some serious money has been spent in the meantime moving stock and equipment. I'm sure that in order for that to happen there had to be some performance guaranties and penalties for failure to perform built in to the letter of intent. At this point I'd be shocked if it doesn't close.
 

adorshki

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At this point I'd be shocked if it doesn't close.

Right, I'm sure it would only be if some lawyer found something in the wording or the compensation structure that was unintentionally legally invalid or unenforcable, at the last minute.
But yeah when people are already moving heavy equipment around it sounds like everything's pretty well checked out from a legal point of view..
 

Synchro

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Right, I'm sure it would only be if some lawyer found something in the wording or the compensation structure that was unintentionally legally invalid or unenforcable, at the last minute.
But yeah when people are already moving heavy equipment around it sounds like everything's pretty well checked out from a legal point of view..
I'm sure that there's due diligence that must be observed at every step along the way. If the money changing hands is borrowed or in any way publicly traded there are all sorts of hoops to be jumped through in order to keep everyone happy and keep it all legal. Deals at this level aren't like buying a used snow tire off of Craigslist. :) Once the check clears the bank, don't be surprised if you see an IPO from FMIC. I'm pretty certain that they did this to get rid of debt in anticipation of an IPO.

All we can do, as a customer base, is hope for the best. It truly is a wonderful line of instruments and should be capable of competing in the marketplace. I can't help but believe that Guild will have a future. The instrument designs are just too good to let die on the vine.
 

guildman63

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Al: You are not driving me crazy but it was not me. I was the one saying it is not a done deal until I see the official press release about the closure...and so far only a letter of intent was signed. (and I referred to legal language). Now that was a month ago...
And yes, the article Sandy shared has some errors in it...Hope CMG does a bit more research about the company they acquired...
Ralf

I believe I called it a done deal, but then relented to Ralf and his "letter of intent". Perhaps I am owed an apology? :barbershop_quartet_
 

adorshki

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Once the check clears the bank, don't be surprised if you see an IPO from FMIC. I'm pretty certain that they did this to get rid of debt in anticipation of an IPO.
I'd be very surpised to see an IPO. They scrapped the last one due to a distinct lack of investor interest, only what, a year ago?
Links in the original thread about the sale indicate Fender still is/was seen as "topped out" in terms of earnings potential, they're perceived as being in a relatively saturated and shrinking market and this particular shedding of debt will do relatively little to change that.
Adding yet further gloom to the forecast is that the real millstone around Fender's neck is Guitar Center as their biggest customer and debtor, and Guitar Center ain't all that healthy either...could drag Fender right down with 'em.
At least that's how I recall it.
 
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Synchro

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I'd be very surpised to see an IPO. They scrapped the last one due to a distinct lack of investor interest, only what, a year ago?
Links in the original thread about the sale indicate Fender still is/was seen as "topped out" in terms of earnings potential, they're perceived as being in a relatively saturated and shrinking market and this particular shedding of debt will do relatively little to change that.
Adding yet further gloom to the forecast is that the real millstone around Fender's neck is Guitar Center as their biggest customer and debtor, and Guitar Center ain't all that healthy either...could drag Fender right down with 'em.
At least that's how I recall it.
I hope that they don't. Publicly traded instrument companies don't sound lime a good idea to me.
 

jimmyl51

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I hope that I am wrong however I would bet major money that we have just seen the end of Guild Patriarch production. Hopefully I will be proved wrong............jim in Maine p.s. I would really like to know if anybody is aware of how many orders up to this transition were actually placed for X-550's and Artist Awards.........
 
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