SFX listed assets of $661.6 million and debts of $490.2 million in Chapter 11 documents filed Monday in U.S. Bankruptcy Court in Wilmington, Delaware.
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In the statement, Stereosonic organisers Totem Onelove distanced themselves from SFX Entertainment Inc, insisting its bankruptcy proceedings are confined to the USA and would not affect Totem Onelove nor their flagship festival.
Entertainment Inc., a well-known promoter of electronic dance music festivals, filed for Chapter 11 bankruptcy on Monday after a year of struggling to reconcile $300 million of debt. The DIP loan will also be used to provide a fully funded exit from Chapter 11.
“Totem Onelove will continue to operate as normal”, Totem Onelove general manager Damien Kease said in a statement on Tuesday. Its worldwide subsidiaries, however, are excluded from the filing. Which basically means that SFX Entertainment has proposed a plan of reorganisation in order to keep the company alive and to pay its creditors over time.
“We at Totem Onelove see this as a positive turn of events for the SFX North American businesses that can now focus on the future”.
“This expression of confidence from our lenders is testimonial to the vibrancy and potential of our business, and the dedication and professionalism of the over 600 people who make up SFX”, said Robert F.X. Sillerman, Chairman and CEO, in a press release.
SFX certainly has little credibility in the financial community after failing to deliver several go private bids and reneging on $30 million in financing.
Because of this new deal, Sillerman will reportedly no longer be running the company.
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While bankruptcy is not uncommon in the music world, there’s no precedent in the concert world for such a large company going bust, especially with so many festivals on the books. SFX still ran up operating losses of $48 million.
