The enfeebled share price of SFX Entertainment has plummeted to new depths in recent weeks – bringing the US company’s market cap valuation down to less than 1% of the worth of rival Live Nation.
MBW revealed last month that the market cap of the Tomorrowland and Beatport owner had lost half a billion dollars in value in just 12 months: on Tuesday, August 18, it hit a new low of $112.3m – or $1.15 per share.
Since then, things have gone from bad to worse.
At the close of the New York Stock Exchange on Friday (September 4), SFX’s share price dropped by another 7.96% to $0.46 per share.
That equated to a worryingly small SFX market cap of $44.94m – less than half the valuation it attracted a month prior.
Perhaps most gallingly for SFX owner Robert Sillerman, the market cap of his rival, Live Nation Entertainment, currently stands at $4.998bn – after a decline of its own since June this year.
That means SFX’s total market valuation now stands at less than 1/100th of Live Nation’s. SFX was worth as much as 1/4 of that price just 20 months ago.
The rapid crash in SFX’s stock price has taken place after Sillerman failed to take the company private in time for a mid-August deadline.
The exec was due to purchase the 62% of SFX he didn’t already own for $774m, but failed to come up with the funds.
There are now real fears that SFX will drop off the NYSE or fall into bankruptcy.
In August, Sillerman approved a fire sale of assets – or the ‘continued exploration of strategic alternatives for the Company, including the sale of all or substantially all of the Company’s assets in whole or in part’.