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SFX board considering multiple bids for the company’s assets

By | Published on Friday 23 October 2015


EDM festival promoter and Beatport owner SFX has confirmed that it received a number of bids for some or all of the company, and it is now considering those offers.

As previously reported, after SFX founder Robert FX Sillerman’s first attempt to take the publicly listed EDM powerhouse back into private ownership failed in August, the company’s independent directors invited bids for the firm or any of its key assets. As speculation about SFX’s finances grew, some started to talk about that process as a “fire sale”.

The extended deadline for offers expired last week. We already knew that Sillerman had made a new offer to buy all the shares he doesn’t currently control, but yesterday the special committee set up to consider the offers confirmed it had received other bids too.

It added in a statement: “The committee is not disclosing the terms contained in these preliminary indications of interest at this time [though] Mr Sillerman’s preliminary bid was publicly filed with the Securities and Exchange Commission in an amendment to his Schedule 13D. The committee is evaluating the indications of interests and is in discussions with those parties concerning the next steps in the process. The committee expects to finalise the bidding process as expediently as possible”.

As previously reported, Sillerman is now offering his company’s other stockholders $3.25 a share, $2 down on his previous offer earlier this year, but still more than three times the current share price. It remains to be seen if his independent directors now approve that bid.

Meanwhile, in other SFX news, attempts to compensate ticket-buyers for problems that occurred at its US-based TomorrowWorld festival hit a snag this week, when an error was reportedly made in the refunds process. As previously reported, the TomorrowWorld event was a washout this year, with heavy rainfall resulting in traffic chaos, and a stripped back final day only open to those already on site at the event.

SFX pledged to refund those affected by the changes to the third day of the festival, with anyone who bought a three day ticket due to get a partial refund. Though, according to YourEDM, the live firm accidentally gave some of those due a third of their money back a full refund. Emails then went out explaining that those punters will now be charged for the two thirds of the ticket price they weren’t meant to get back.

Sillerman has insisted that insurance means the headaches at TommorrowWorld won’t damage his company financially, though he admitted that the problems were bad for the event’s reputation. And while the refund error also should sort itself out, it’s another slip up for a festival and company subject to more scrutiny than most at the moment.