Guitar Center Gets Debt Deal to Stave Off Default Amid Closures

Guitar Center Inc. sold new bonds to help pay for some of its old debt as it fights to stay afloat during the pandemic with its stores shut.

The largest U.S. retailer of musical instruments and equipment sold about $32.5 million of new senior secured notes with a 10% coupon due 2022 to holders of its existing first-lien notes, according to people with knowledge of the arrangement. The company used the proceeds to pay the coupon on its existing first-lien notes due 2021, the people said, asking not to be identified discussing a private matter.

Guitar Center has fulfilled debt ...