As reported The Industry Observer last month, iconic guitar brand Gibson is currently facing bankruptcy, with the company owing $145 million in bank loans that were issued in 2013.

Since then, the business has issued a statement “eliminating product segments that do not perform to our expectations”, with CEO Henry Juszkiewicz shifting the blame towards the failing retail sector.

Now, as reported by the Dayton Daily News, with financial house Standard & Poor lowering the company’s credit rating from a ‘CCC-‘ from ‘CCC’ meaning there “could default on its debt obligations over the next six months” with “little prospect for recovery”.

Standard & Poor also said there was an “increased likelihood” that a restructuring event could occur within the next six months, which has already begun with the appointing of a new CFO, Benson Woo.

A Nashville newspaper has also reported that Gibson has laid off around 15 employees from its Custom Shop – a sector of the company dedicated to making recreations of vintage models and special one-off orders. This is said to be part of what Juszkiewicz described as minimizing “parts of broad initiative throughout the company to prepare for our refinancing.”