Fender IPO set at $13 to $15, values guitar maker at $395 million

Fender Musical Instruments Corp., guitar maker to rock gods such as Jimi Hendrix, Bob Dylan, Bruce Springsteen and Kurt Cobain, said its initial public offering will likely price at $13 to $15 a share.

The company expects 10.7 million shares to be sold – 7.1 million by Fender and 3.5 million by private equity firm Weston Presidio, raising as much as $160.7 million, according to a filing with the Securities and Exchange Commission.

With 26.4 million shares outstanding after the offering, Fender would be valued around $395 million.  

The rock 'n’ roll giant, known for its Stratocaster electric guitars, distributes its products in more than 85 countries. The company hopes to take advantage of the “increasing popularity and gradual incorporation of guitar-based music in some large, emerging markets like China and India,” according to the filing.

The company, launched by Leo Fender in 1946, had first filed for an offering of up to $200 million in March. Once the guitar maker goes public, Weston Presidio’s share will shrink from 43% to 17.7%.

The company, which is based in Scottsdale, Ariz.,but manufactures its products in Corona, Calif., will be listed on Nasdaq under the FNDR ticker. In its last fiscal year, revenue rose 13% to $700.6 million while profit soared to $19 million, recovering from a net loss of $1.7 million in 2010.

The musical instruments and accessories industry generates $15.8 billion in global sales and is a $6.4 billion industry in the U.S.


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