Rumors are surfacing about EDM giant SFX Entertainment as turmoil over the Tomorrowland Festival comes to light after heavy rainfall paralyzes ticketholders from attending the annual event in Chattahoochee Hills, GA. The refunds from stranded ticketholders and lost concessions have taken its toll as Wall Street (NASDAQ: SFXE) responded with a paltry closing price of $0.42 a share at the close of the Monday session.
Torrential rainfall seized the area paralyzing transportation routes to the rural festival location. Many ticketholders were stranded on the side of the roads left to sleep in their cars. Festival producers shuffled to reorganize the festival consolidating the nine stages to only five. The expected attendance of the event was 190,000 over the course of the 3 day festival.
SFX is no stranger to turmoil as earlier this year Robert Sillerman, the founder of SFX, offered to take the company private purchasing 62% of the cash strapped company for $5.25 a share or sell the company to a qualified party. After the August 13th deadline past and no deal closed, the companies stock plummeted.
BizJournal is reporting that several assets of SFX have become available for sale such as:
• Flavorus. Ticket platform geared towards EDM
• Beatport. A music sharing and download site
• React Present. Chicago based event producer
• ID&T. Amsterdam based festival producer that brought Sensation to the Barclay Center in 2014
• Totem One Love Group. Australian based festival producer
• Monumental Productions. Awakenings Brand
• 50% stake in Alda Holdings. Amsterdam based event producer
Could this mark the end of EDM? The imminent fall of SFX leads onlookers believing this will mark the fall of electronic dance music. We believe however that this will be a much-needed contraction in the dance music market. Artist talent fees are at an all time high and the consumers have finally spoken back. Only the strongest talents and artists who connect with fans in different ways will continue to have success.
Comments