Festival operator Superstruct has been acquired by investment firm KKR. Financial terms of the deal are not known, but the business was estimated to be valued at £1.5 billion earlier this year.
Founded by equity firm Providence and Cream founder and former Live Nation exec James Barton in 2017, Superstruct runs festivals including Sonar, Benicàssim, Sziget, Bluedot and Boardmasters. Providence reportedly began making plans for a sale last year - before formally putting it up for sale in April - in a bid to capitalise on the post-COVID bounce back of live music.
Those gains have mainly been made at the top end of the live music market, with independent events facing significant challenges. However, those that are part of a group, such as Superstruct, are well placed to take advantage of economies of scale.
In a joint statement, KKR partners Philipp Freise and Franziska Kayser said Superstruct has established itself as “a leader in delivering unparalleled live music experiences globally”.
“With a robust foundation as a top-tier live entertainment platform, we see significant growth opportunities ahead for Superstruct”, they went on. KKR, they said, will “support the company and its entrepreneurial team to bring their compelling portfolio of live event formats to a wider audience and drive further growth”.
Superstruct’s portfolio of events now consists of 80 music festivals across nine European countries and Australia, giving them a potential reach of nearly seven million attendees. That reach allows Superstruct to operate a successful brand partnerships business which further allows its festivals to successfully operate in a challenging marketplace.
There are fears from some quarters that brands might reduce their sponsorship activity around music and other cultural events following the recent controversies involving Barclays’ sponsorship of Live Nation’s festivals and investment firm Baillie Gifford’s involvement in various literary festivals. Brands fearful of a possible backlash might look to involve themselves in sectors where there tends to be less scrutiny - such as sport.
Superstruct’s events have been able to successfully navigate some of the financial challenges faced by independent festivals, thanks in part to their festivals being within a well-funded corporate group. However, if those fears about brands leaving music come to pass, that will inevitably affect the bigger players in the market too.
Nevertheless, the team at Superstruct remain positive. Barton - now Chair of Superstruct - and CEO Roderik Schlösser added that they are “proud to have secured the backing of KKR, whose expertise and network will strengthen our ability to scale and innovate in the vibrant experiential economy”.
As part of the deal, Providence retains an option to invest $250 million into Superstruct.
