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SFX secures $90 million in new financing

By | Published on Friday 18 September 2015

SFX

So, EDM powerhouse SFX has a little more cash to play with. The embattled festival promoter and Beatport owner yesterday announced it had secured $60 million in new financing and that it had refinanced its $30 million revolving credit facilities. So, quick, let’s have a big EDM party before it’s all spent.

There has been much speculation about SFX’s financial position of late, of course, amid the company’s slumping share price and all the confusion around founder Robert FX Sillerman’s attempts to take the business back into private ownership. As much previously reported, Sillerman’s initial attempt to buy all the SFX shares he doesn’t currently own was abandoned after he failed to secure financial backing for the plan, not least because the share price slump made his original rather generous offer unrealistic.

The new $90 million comes from both new and existing investors, SFX said yesterday, and ensures funding “for new initiatives and operating and working capital needs”.

Sillerman himself added: “This round of financing from these sophisticated investors reflects a level of confidence and provides growth capital to support many of the exciting new initiatives SFX is undertaking”.

SFX’s board is still accepting offers to buy the company or any “assets not central to its core business”, with 2 Oct still the deadline set for such proposals. Sillerman is also expected to come up with a new buy-back plan for that date too. Confirming that various options for his company’s future were still being considered, the SFX chief added that the new financing “solidifies SFX for the short and long term, so we can focus on producing great festivals and events and operating globally recognised digital properties”.

Meanwhile SFX’s CFO Richard Rosenstein added: “With the success of many of our festivals in the current quarter and this added financial flexibility, SFX is better positioned to continue growing our powerful brands and support our extraordinary team members who are focused on executing on our strategic plans. This also eliminates all operating distractions as we explore proposals from interested strategic partners”.

So, there we go. SFX’s share price did rise after the new financing deal was announced, though stills sits at 62 cents per share, compared to $3.70 at the start of the year.



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