AUG. 11 | BROOK MAYS MUSIC | FINANCE
After a 105-year run, financial difficulties have forced Dallas-based Brook Mays Music to close shop.
On Aug. 9, Judge Stacey Jernigan approved a $33.4 million asset sale. Brook Mays’ 62 locations would be closed, and its retail inventory would be liquidated. SB Capital Group led the purchase with the highest bid, and its partners included EMCC, Tiger Capital Group and Palisades Collection. SB is holding a sale for Brook Mays’ inventory, which it plans to conclude by the end of November.
The sale comes after Brook Mays filed for Chapter 11 bankruptcy protection with the U.S. Bankruptcy Court, Northern District of Texas on July 11.
According to Scott Bernstein, principal and COO of SB Capital, Brook Mays’ instrument rental business will continue uninterrupted.
“For those customers who have rented instruments from Brook Mays, there will be no difference in the level of service,” he said to The Dallas Morning News.
The newspaper also reported that SB’s offer was 16-percent higher than an initial bid of $28.7 million made by National Music Funding and Great American Group.
Brook Mays’ top 20 music instrument creditors are owed in excess of $23 million. According to an Associated Press report, Brook Mays also owed its lending group, led by JPMorgan Chase, roughly $41 million.
The bankruptcy includes Brook Mays Music and companies it does business as, including Zeswitz Music, Caldwell Music, H&H Music, Larson Music, McMurray Music, McFadyen Music, Pearson Music, Duncan Music and Dunham’s Music.
Company CEO Bill Everitt, in an interview with The Dallas Morning News, blamed the filing on lower-than-expected back-to-school and holiday sales last year. He attributed the lower holiday sales to increased competition from mass merchants, such as Target and Best Buy, over entry-level instruments.
Among the companies rumored to buy Brook Mays Music was Guitar Center’s school music division, Music & Arts Center. While Music & Arts didn’t make the purchase, the company has stepped up its presence in Texas to fill Brook Mays’ void.
The company has opened 10 temporary retail locations, half of which will operate out of existing Guitar Center stores. The other half will operate out of temporary retail spaces under the Music & Arts name as construction is completed on new stores. A central hub in Dallas is planned, and according to a statement issued by the company, more stores will open in the near future.
“This is a crucial time for young musicians,” said Ron Beaudoin, Music & Arts Center’s senior vice president. “The demand for rental instruments is high, and without a way to meet that demand now and into the future, many of these students would miss out on an important opportunity. We’re happy we could open these temporary locations to begin meeting both the short- and long-term needs of student musicians.”