Legendary guitar company Fender tunes up for float

The guitar-maker Fender, whose instruments were used by music legends including Jimi Hendrix, is launching its initial public offering in New York to raise as much as $160.5m.

The company, formed in the 1940s by Leo Fender, was the first to mass produce solid-body Spanish-style electric guitars, including the iconic Stratocaster. It expects to sell 10.7 million shares at $13 to $15 each, valuing the business at about $395m.

After the fundraising, San Francisco-based buyout firm Weston Presidio, Fender's biggest shareholder with a 43 per cent stake, is set to own about 17.7 per cent. Fender has said it does not expect to pay cash dividends in the short term.