Bankruptcy SFX Entertainment Seems Unavoidable
Festival organiser SFX Entertainment is considering applying for bankruptcy. This was reported by the American business magazine Forbes. The company behind i.a. ID&T, b2s and Awakenings reported a net loss of 90 million dollars in the first six months of 2015.
SFX Entertainment already started to falter the previous summer. According to Forbes, the company was looking in vain for investors and parties interested in acquisition. Credit rating agency Moody's doubted earlier whether the company was beyond saving or not. The Wall Street Journal writes that the company has a total debt of 312.6 million dollars and that the stock price has plummeted entirely.
SFX used the money it collected at the public offering in 2013 to make acquisitions, but perhaps the eccentric top man Bob Sillerman was a bit too eager when he spent the money buying dozens of EDM festivals.
Rocco Veenboer, the Dutch founder and CEO of the Awakenings festival, informed Dutch newspaper Het Parool that he intends to buy the event back from the American owner. In 2014 he sold Awakenings to SFX for 16.5 million dollars and remained the CEO. "If SFX were to topple, I'm ready. But I don't want a 100 per cent share anymore. I want a few visionary top entrepreneurs as fellow shareholders and I also want to give the current employees an opportunity to buy shares."
Organiser ID&T was also interested in partially or entirely buying back the company. Duncan Stutterheim, who left ID&T and SFX in April, was discussing a possible transaction, as reported by Dutch newspaper Het Financieele Dagblad in October. The transaction did not come to fruition due to a 'lack of enthusiasm', but the article did hint at the chance that former ID&T partners might be interested in an acquisition.
SFX is also a partner of Tomorrowland, which helps organise TomorrowWorld in the United States and Brazil. TomorrowWorld turned out to be a blunder for SFX. Harsh weather conditions made it so that only 40,000 of 190,000 attendees made it to the festival on the last day. The new Californian festival One Tribe was cancelled due to bad ticket sales.