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Fender Drops IPO Plans

Fender
Dan Kitwood, Getty Images

If you were one of the potential investors looking to own a piece of Fender after the guitar maker announced its plans for an IPO in March, we have some bad news for you: The company isn’t going public after all.

Market concerns were cited as the culprit in a Businessweek report announcing the cancellation, with Fender CEO Larry Thomas also pointing to Europe’s continuing economic woes as a sign that Fender wouldn’t be able to raise an appropriate level of money through an IPO.

Keating Capital CEO Tim Keating insisted that IPOs have picked up again following Facebook’s notoriously bumpy road to public valuation, but admitted that the companies finding the greatest success are in the tech sector. “When you look at the growth prospects, what excites IPO investors is the prospect of growing at least 20 to 25 percent over the next few years and Fender doesn’t have those prospects as a more mature company,” he pointed out.

Added investment banker Thomas J. Murphy, “It could be that once they got out and became more familiar with the market, and saw what things were like, they realized it wasn’t the right move for them.”

As we reported several weeks ago, Fender expected to raise over $160 million in the IPO; there’s no word on how this change in plans will affect the company’s long- or short-term economic health.

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UltimateClassicRock.comRead Original: Fender Drops IPO Plans

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