Robert Sillerman Makes $774 Million Deal To Take SFX Private
May 26, 2015 at 10:09 AM (PT)
SFX ENTERTAINMENT Founder/Chairman/CEO ROBERT F.X. SILLERMAN has agreed to a $774 million deal that will take the company private, less than two years after its initial IPO, NEW YORK TIMES reports. SILLERMAN, who controls 37.4% of SFX, would acquire the shares he doesn’t already own for $5.25 each in cash — 50 cents a share higher than SILLERMAN had initially offered in FEBRUARY, and a 42% premium over the share price on FEB. 24th the day before his offer was made public.
SFX has been valued at less than half its price when it went public in OCTOBER 2013 at $13 a share. Since then, it has acquired music festivals like ELECTRIC ZOO, TOMORROWLAND and ROCK IN RIO, as well as the online music store Beatport. In its Q1 2015 earnings report, SFX reported $52 million in revenue and almost $42 million in net losses.
SILLERMAN’s offer to take SFX private was approved unanimously by the company’s board. As part of the deal, SFX will have a 45-day “go shop” period in which alternative proposals will be accepted.
ALBERT FRIED & COMPANY analyst RICHARD TULLO estimated that there was a 20% chance a higher bid could emerge from other bidders. But “given the recent history of disappointing results,” he said, “we think the $5.25 bid with the opportunity to participate in the equity is a fair deal.”