Sweetwater sold to capital investment company

[smurfyou]

Originally Posted by JFreak

Usa is a complex vampire system anyway, money talks and someone else walks. Maybe what you told is true there, but in here there are actually investment companies who buy other companies to make small profit yearly, and the more the merrier.

Don't want to derail the topic down a rabbit hole but you are correct. It doesn't usually end up very merry here.

I had no idea Sweetwater also owned a used luxury car dealer, helicopter charters and private airplanes among other random businesses. If this group invested in the whole parent company that makes a lot more sense.

[DonaldM]

I'm sorry to hear about this. I've been a Sweetwater customer for years. I only live 2 hours from their superstore and HQ and know some of the folks there. I've been there many times. Its really something to see.

I really hope they won't change too much. But that's probably a fool's hope.

[DonaldM]

Well, this sounds a little more promising. Chuck Surack, the Founder, is stepping down as CEO, but becoming Chair of the Board. The current Exec. VP will be the new CEO, so there will be continuity of leadership from those who built the company. The Partnership owns a majority of the company, but it appears that they are making an investment, not necessarily wanting to run the show. We'll see.

[K Roche]

Originally Posted by smurfyou

Don't want to derail the topic down a rabbit hole but you are correct. It doesn't usually end up very merry here.

I had no idea Sweetwater also owned a used luxury car dealer, helicopter charters and private airplanes among other random businesses. If this group invested in the whole parent company that makes a lot more sense.

Well technically "Sweetwater" does not own those other companies. The owner of Sweetwater owns those other companies and uses Sweetwater in the names. As far as I understand it, those are completely separate companies are not part of the this PE majority ownership deal

[K Roche]

Originally Posted by smurfyou

I don't know if this exists anywhere else in the world, but here in the states we have "Private Equity" firms that are corporate vampires. They take advantage of various loopholes to control a company without regard for its debt. They quite literally bleed it dry and bankrupt it on purpose and somehow walk away with a massive profit.

So that's why it matters who owns a company. A PE firm is usually a sign of a death spiral.

Before anyone in the financial industry replies, I realize this is oversimplified but this is the result of a lot of these takeovers.

I am not in the financial industry. While it is certainly true that here in US PE Firms have presided over a number of spectacular and highly publicized failures ...But PE here in the US. According to last article I read ,,,It's not a matter of being "oversimplified" so much as not actually being completely accurate "A PE firm is usually a sign of a death spiral" buy the numbers is not accurate . Now PE does involve a much higher failure rate (estimated to be about 20% as opposed to other refinance methods which average some 4 or 5 % failure ) While no doubt this considerably a higher rate, and has contributed to PE 's very bad reputation ..But in reality that leaves still the "usual" not failing and often even growing in revenue at 80% Juss sayin'

Also the article pointed out that almost of of that 20 % failure involved already publicly traded companies already carrying debt and the PE increased that debt or the PE took over management and had little or no knowledge of the specific business None of which seems to be the case with this Sweetwater deal (Yet)

So What will happen remains to be seen..