Relentless Beats

SFX Entertainment Files For $175 Million IPO

Robert Sillerman, CEO of SFX Entertainment, leads his company into the public markets with an initial public offering of $175 million. SFX has invested or purchased promoters such as ID&T, Disco Donnie Presents, Life In Color, and is reportedly in the process of purchasing Made Event, the promoters of Electric Zoo. Investment in ID&T led to the creation of ID&T North America bringing Sensation, Mysteryland, Q-Dance, and TomorrowWorld to the United States.

SFX bought Beatport outright for $50 million earlier this year as well, ramping up their electronic music influence as the genre continues to boom. The company’s SEC filing shows that they held about 809 events and 52 festivals in 2012, attracting over 2.8 million attendees.

Under the ticker “SFXE”, the New York based company intends on using the extra capital to fund further acquisitions in the EDM community, and for general working cash on hand. In 2012, SFX generated revenue of $24.8 million, but posted a loss of $16.2 million.

UBS Investment Bank, Barclays and Jefferies will underwrite the securities. The amount of shares and pricing was not listed in SFX’s initial filing.

After confirming 180,000 TomorrowLand 2013 reservations in a single second, SFX entertainment is ripe for growth, projected to be worth $4.5 billion in 2013, according to the International Music Summit Business Report.

The electronic music scene continues to consolidate. The Sillerman-built LiveNation (NYSE:LYV) invested in Insomniac this year, posing the biggest competition against SFX as they move forward.

For now, SFXE might be worth it for that bit of portfolio diversification that all ravers need.

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