Bankrupt SFX is planning to sell off its DJ download and streaming site, Beatport, according to statements issued today. The company was purchased for $50 million less than three years ago.
Last month, DMN reported that SFX had filed for bankruptcy amidst mounting debt and a series of horrific business choices. Shortly thereafter, Beatport released a statement assuring both fans and DJs that there would be minimal disruption and that it would be ”business as usual”.
Now, exactly one month after that meltdown, the inevitable has happened: Beatport is getting sold to the highest bidder, with extremely uncertain next steps. In US Bankruptcy Court in Delaware, SFX agents Kurtzman Carson Consultants have now filed a motion for the sale ”of all or substantially all of the assets of Beatport.”
In 2013, SFX Entertainment bought the company for a reported $50 million. A few years later, few are predicating that SFX will recoup that amount of cash. Or even a substantial fraction of it, given SFX’s extremely-distressed bankruptcy state.
The auction is thought to be the first of many to come, and largely unsurprising given SFX’s financial woes. In fact, SFX is already planning the sale of digital marketing subsidiary, Fame House, which is reportedly being marketed by Moelis and Company to potential buyers. Looking forward, SFX will continue to auction off its subsidiaries to pay off its debt, focusing on the ‘non-core assets’ first.
So what does the future hold for SFX and Beatport?
Whilst Beatport’s future is muddy, the site has evolved past its mainstay of song downloading. Just last year, SFX added a streaming component, an upgrade that could attract buyers given a massive consumer shift towards access. The rest is highly uncertain, especially for DJs that rely on Beatport for income.
Image by Gordon Jolly, licensed under Creative Commons Attribution-ShareAlike 2.0 Generic (CC BY-SA 2.0).