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SFX appoints bankers to explore debt restructuring
By Chris Cooke | Published on Tuesday 1 December 2015
Flagging EDM powerhouse SFX is exploring debt restructuring, a spokesman for the firm’s CEO Robert FX Sillerman confirmed to Reuters yesterday.
Speculation continues about the future of the festival operator and Beatport owner after Sillerman aborted his most recent effort to take the firm back into private ownership last month. The SFX board had invited others to bid for some or all of the business, but there has been no word on whether any decent offers were forthcoming, or whether the independent directors considering the bids are planning on selling off any assets.
According to the sources who spoke to Reuters, investment bank Moelis & Co – which had previously been advising on the bid-taking process – is now reviewing the EDM company’s debt-pile. The company reportedly has debts in the region of $300 million. Meanwhile, because its share price has tanked so much this year, and currently stands at just 28 cents, the current market capitalisation of the firm (the current value of all shares issued to investors) is below $30 million.
A spokesman for Sillerman told the newswire: “It is correct that the company hired Moelis to examine broadly its position. That principally includes sales of non-strategic assets as well as examining the capital structure of the company”.
Some reckon that Moelis & Co’s latest assignment is a last ditch attempt to stop SFX from slipping into bankruptcy.
Meanwhile, the New York Post reports that $30 million of the $90 million in financing SFX secured back in September actually came from another Sillerman-controlled entity and, as of recent filings last month, $15 million of that had yet to be handed over.
