Gibson electric guitars has filed for bankruptcy protection as it deals with $500m debt.

Lenders will take control of the Nashville-based company, which was founded in 1902. Four years ago the company acquired Philips' consumer audio division for $135m. Gibson now intend to leave that business, and deal with musical instruments.

Chief executive Henry Juszkiewicz said that the bankruptcy filing would assure the company's "long-term stability and financial health," according to the BBC.

Highly prized instruments in their day, Elvis Presley played a Gibson and they are played by Keith Richards and Jimmy Page

The Gibson company manufactures electric guitars in Nashville and Memphis, while its acoustic guitars are manufactured in Bozeman, Montana.

It sells more than 170,000 guitars annually in more than 80 countries and electric guitar sales in particular have been doing exceptionally well.

The earliest documented instrument produced by founder Orville Gibson was a mandolin made in 1894, with the company being officially founded eight years later.