Robert Sillerman has withdrawn his offer to take the beleaguered dance music conglomerate SFX Entertainment private. Citing market conditions and the company's tanked stock price, Sillerman is deciding to try and stay the course and turn things around as a public company.
According to an internal memo obtained by the Wall Street Journal, Sillerman is no longer interested in buying back all of the company's stock. The memo reads, ""At these low prices the time is not right to go forward on this path. We will instead focus all energy on righting the ship and reversing the disappointing results of this year," he wrote. "[We will] revisit things as they develop. For now we will rededicate ourselves to providing the best possible experiences for our fans."
Sillerman's last offer that he is now backing away from would have made him buy all of the remaining stock on the market for $3.25 per share. He was struggling to find the financing to take company private and had to extend the go-shop period to either find the financing to take the company private on his own, find a competing offer or find suitors for individual parts of the company. SFX said that there was some interest in aspects of the company, but so far nothing has been announced in terms of a sale.
There have been rumblings of a possible bankruptcy on the horizon if the company does not right the ship of find a way to shed some of its mounting debt and balance its books.
SFx's current stock price sits at a paltry $.24 and was down 40 percent after trading today, Nov. 19. The year low is $.17, which means things have been worse, but things are looking bleak for Sillerman if he wants to turn things around, especially now that the big dollars from the North American festival season are behind him and salaries still need to be paid.
SFX owns companies like React Presents, ID&T, Made Event, Beatport and more.