David Lieberman, "'American Idol' Owner CKX Sells To Financial Firm, Ending Robert F.X. Sillerman was the owner of a range of television and radio stations during the 1970s and 1980s, In 1993 he formed SFX Broadcasting, and then built SFX Entertainmenta concert and stage performance promoter that was sold to Clear Channel in 2000 for $4.4 billion. That is, if SFX is still around in a year to run those events. LinkedIn has officially entered its cringe era, and its working. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Thanks for contacting us. Brucie and Bob bought more stations and worked their magic on operations. By that time Mr. Sillerman had turned his sights on another industry ripe for consolidation: the nationwide concert circuit, which had long remained a loosely connected network of venues and promoters who operated regional fiefs. Clear Channel, which had already purchased many of Sillermans radio stations from Hicks Muse, agreed to buy SFX Entertainment for a reported $3 billion. I should get a waterproof one for the shower., At this particular sit-down, when Sillerman gets around to talking about CKX, he says, Technology is breaking down the old lines of distribution. 19 did some $92 million in revenues last yearwith about a third coming from the Idol showsand earned $12.6 million. You may find him a bit quirky. Down the road EPE may construct more Graceland-like properties in places such as Dubai and Macau, and perhaps develop a concept similar to the Hard Rock Cafs in Europe. Sillerman graduated from Brandeis University in 1969, avoided the Vietnam War draft due to an injury and eventually went on to buy 92.7 WALL-FM in Middletown, New York, with famed DJ Bruce Cousin Brucie Morrow, according to Ticket Masters. And the show garners the highest ad rates on network TV, between $660,000 and $705,000 for a 30-second spot, which is higher than CSI or Desperate Housewives. Hes been known to sneak up on people and scare them. Sillerman took the job on two conditions: that the college scrap ill-defined programs and focus on marine science and creative writing and that he be allowed to handle publicity. The companys chief Michael Rapino declined a request for an interview through a spokesperson. In the mid-1980s the Federal Communications Commission was beginning to loosen its restrictions on the number of radio stations that could be owned by a single operator. What was most impressive about his $389 million deal with Westinghouse (which was convinced that it needed to become a big player in the business) in 1989 wasnt that it was his biggest score ever; it was the fact that the market for radio stations tanked soon after. In characteristic form, Sillerman wont give investors any firm commitments. In 1993 he founded SFX Broadcasting with a partner, R. Steven Hicks. However, since doubts of Sillerman's take-private began to emerge in July, the company hasn't disclosed a bona fide competing offer. Robert F.X. Clear Channel had integration issues with SFX, according to one analyst, and now plans to spin off that business by early next year. Around that time Sillerman was diagnosed with tongue cancer and underwent chemotherapy, which sidelined him for several months. Clear Channel would later spin off its concert holdings into Live Nation in 2005 with CEO Michael Rapino at the helm, which grewinto the most dominate company in music, with $15 billion in revenue reported in 2019. The app will also display the social media activity for other shows at the same time, along with what rewards are available for changing the channel to competing programs. He. (Rumors suggesting that Sillermans next big acquisition has been delayed have been a drag on the stock.) But where did it go wrong for SFX? In December 2016, former SFX board member Mitch Slater sued Sillerman for an unpaid $2.5 million loan from 2015. Five years later, Clear Channel spun off those concert assets into a separate company, Live Nation, which in 2010 merged with Ticketmaster to become Live Nation Entertainment, the biggest concert promoter in the world. Think of how we can continue to expand the show, says Fuller. He likes to jump out of the bushes or hide in hotel rooms and scare people, says Cousin Brucie. Unable to issue new debt without breaching bond covenants, SFX sold stock before the quarter's end to raise collateral that its banker, Barclays, had demanded in order to borrow from the companys credit line, a rainy day source of cash. In the sale, SFX kept two small concert promoters, and renamed the company SFX Entertainment (concert promotion, sports agencies), turning SFX Entertainment into the world's largest producer, promoter and presenter of live entertainment. Robert Sillerman, born April 12, 1948 in the Riverdale section of the Bronx, early on had a strong entrepreneurial bent starting a greeting card in high school and a youth marketing company while at Brandeis University. No, I dont think the mistakes I made had anything to do with my lack of background on this particular type of music, he said. So he offered investors a lower price, $12 a share, and the sale was extended even longer. Today about 600,000 visitors make the pilgrimage to Graceland each year (30% from abroad), paying between $22 and $55 apiece. SFX raised $260 million in its initial public offering. Elvis, a poor boy from Tupelo, Miss., comes up to Memphis, manages to get himself into Sun Records, and lays down the track to Thats All Right (Mama). A local radio station airs it, the calls come streaming in, and Elvis is on the way to glory. He was also starting to run afoul of the SEC an audit by the firm BDO of his company Function(x)found that Sillerman allegedly broke the law when he transferred $6.1 million into his own personal account and withdrew $500,000 in cash with no explanation and no supporting documentation. Sillerman settled the case with the SEC in June, agreeing to a $179,000 fine and a ban from holding an officer or director role at any public company. Investor and media executive Robert F.X. It wasnt a plan too dissimilar to Sillermans moves with the original SFX where he spent more than $1.2 billion to gobble up regional rock promoters, venues and management companies in the late 90s. FORTUNE may receive compensation for some links to products and services on this website. Sillerman, Concert Industry Consolidator, Dies at 71", "American Idol Sillerman Dealt Elvis Default Heartbreak in Vegas", "Will Viggle, the 'Loyalty Program for TV' From Robert F.X. When presented to the public--and later, Wall Street--the plan for SFX Entertainment seemed simple enough: roll up local EDM event organizers under one umbrella organization that could drive profits by providing structure and efficiency. He died on November 24, 2019 in Hinsdale, New Hampshire, USA. But from 2013 to 2014, the increase slowed to 11%; this year, its only 2.5%. That lit a fire under the radio business, and Sillerman plunged back in, buying more radio stations, leveraging up his new company, and securing investments from the Bass family and Security Pacific bank, among others. Hes obviously smart, and he doesnt b.s. Sillerman, a triathlete who loves vigorous games of volleyball and basketball, has recovered and now sports a yellow Livestrong bracelet. In 2000 he sold a company that owned concert venues to Clear Channel for a reported $3 billion. Its different, Sillerman says. I have a million ideas all the time, says Fuller, but before I could only do one a year. On Jun 7, 2012, Function (X), Inc. was renamed Viggle, which changed the company stock listing to VGGL. The Bolshoi Ballet came en masse to Graceland, Soden recalls. An entrance foyer leads to a chefskitchen, while a double-wide staircase leads upstairs to the first floors entertainment spaces: a living room, wood-paneled library, formal dining room, serving kitchen with a dumbwaiter and three of seven woodburning fireplaces. The company that emerged would become Clear Channel, which is now known as iHeartRadio. Robert F.X. And dont forget about the Heartbreak Hotel. His cost basis on these shares? [10], Leading CKX, Inc., Sillerman bought majority rights to Graceland, the Elvis Presley estate;[11] as well as the assets of Simon Fuller's 19 Entertainment, whose assets include TV hit American Idol and managed clients including football player David Beckham. Then there are concert tours and merchandising. CKX also gets the publishing rights to 650 songs, but owns the more valuable royalty rights to only the few songs Elvis recorded after 1973. And I haven't a fucking clue what they do or what they're talking about. We have estimated Robert F.X. At various points heated negotiations and lawsuits ensued between Sillerman and the likes of PaineWebber, Steinhardt Partners, and W.R. Huff, who alleged that Sillerman was trying to shortchange investors. Backstage at The Ed Sullivan Show, 1956: Elvis with the host and manager Parker (left).CBS Photo Archive/Getty Images. Despite this, the 67-year-old CEO said that he is the right man to run the troubled business and that he still wants to own the company even though he reneged on a plan to take it private earlier this month. He often named his companies using some combination of those initials. It declared bankruptcy in 2016, and many of the assets it had amassed were sold off. In September 2012, Sillerman announced his biggest project to date on the cover of Billboard, sporting a black leather jacket, a global-shaped disco ball and a handkerchief in his pocket that famously read FOff., Its a universal statement, Sillerman told Billboard writer Kerri Mason. But when the so-called "go shop" ended, Sillerman didnt have the financing to cover his bid. 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In June 2007, Sillerman told investors of CKX--a Nasdaq vehicle hed created with intellectual property rights to American Idol, Elvis Presley and Muhammad Ali--that hed pay $13.75 a share to take the company private. Elviss 37-year-old daughter and heir, Lisa Marie, has been unhappy that the business has been going nowhere: We were doing good, but you cant stay the same, she says. The lawsuit is set to go to trial in October in a federal court in Los Angeles and has been one of a handful of elements to weigh heavily on SFXs stock in the last year. This is a BETA experience. Thats $4.3 millionlessthat what Sillerman and his wife Laura had paid for the residence at 151 E. 72nd St. when they bought it for $12 million in 2013. FORBES first started charting DJ earnings in 2012; a year later, the collective income of the top ten acts had doubled. In the mid-1970s he scraped together $600,000 and enlisted Cousin Brucie Morrow, then one of the top deejays in the country, to become his partner and buy a rock & roll radio station in Middletown, N.Y. Bob can sell igloos, says Morrow. By then Sillerman was already toiling away on his next project, SFX Entertainment, a company that would own concert venues and other media properties. The guy didnt have any energy, says Morrow. Few suggest the genre is decliningnot yet, anywaybut theres evidence that points to a plateau. Though the Elvis business isnt that big yet, it gives us a window into how Sillerman operates. Sillerman Dies at 71; Built Entertainment Empires, https://www.nytimes.com/2019/11/28/arts/music/robert-fx-sillerman-dead.html. That didnt work out, but when we started talking, Insomniacs acquistion price was $10 million, he said. [35] For thirteen years, Sillerman served as the Chancellor of Southampton College and is the founder of The Tomorrow Foundation. The show is also being franchised in 100 countries. The founder of SFX Entertainment rarely spoke about the impact of his daughters death but his friends say it weighed on him and changed his outlook. Lisa Marie Presley, Elvis' daughter, had sold the majority of Elvis Presley Enterprises, . He has unbounded energy when it comes to business. With reporting from Sue Radlauer and Zack O'Malley Greenburg in Jersey City, N.J. 19 is the brainchild of Simon Fuller, whom Sillerman describes as a cherubic bundle of nonstop creative energy. Fuller started out as a talent scout in the 1980shis company is named after a hit song by an artist he manageddiscovering and working with British rock groups like Spandau Ballet, Billy Idol, and Ultravox. Investor Robert Sillerman, who bought Elvis Presley Enterprises, photographed with Elvis impersonators, 2005. Even so, says Lisa Presley, theres only so far you can take a family-run business. [15][16] As of the end of 2013 Viggle had about 3.7 million users. Sillerman had bought Elvis Presley Enterprises from Lisa Marie Presley in 2005, but later sold it to a private equity firm. Could it be that Sillerman didnt fully understand this--or just how skittish it would make brands? Maybe, but maybe not. Sillerman's income source is mostly from being a successful Executive. Billboard is a part of Penske Media Corporation. In 1989 he sold a group of radio stations to Westinghouse (now Viacom) for $389 million. On the subject of corporate partnerships, Sillerman said he underestimated the time it would take to sign up sponsors for SFXs events. How Trust In Institutions Determines COVID Vaccination Rates In The EU, Clubhouses Future Depends On Data - How To Build A TikTok Like Algorithm. unclear if newer events will have the same kind of draw. No question we could build a convention-sized hotel here, says Soden. On Friday, the stock closed at 91 cents a share. SFX bought up enough stations to become the nation's seventh largest chain. And Fuller is looking to bring a gritty nighttime soap opera that is popular in Britain to America next summer. SFX now has a market capitalization of $88 million. Posh Spice). Even very young people. So far Idol stars like Kelly Clarkson and Clay Aiken have sold over 14 million albums. Capstar applied for and received permission to operate more than one class of radio station in the same market. Besides buying Elvis Presley Enterprises from Lisa Marie Presley last February, Sillerman and his lieutenants have purchased the smash-hit TV show American Idol and other properties from a company called 19 Entertainment, which was owned by British pop impresario Simon Fuller. Sillerman. We cured him. By 1985 the pair had accumulated some 70 stations, which they sold for some $50 million. Former employees also interviewed by Billboard felt that the company did not do enough to leverage its scale, and that the company did not engage in centralization, leading to a lack of coordination between its collection of subsidiaries. Another $25 million from CKX went to pay off EPE debt. Try A Different OS, Get Vaccinated? But Sillerman was drawn to his fathers business. Sillerman was eventually pushed out of the company by creditors and it re-emerged as LiveStyle in 2017 with entertainment veteran Randy Phillips at the helm. Moreover, those familiar with the live events industry know that festivals can lose millions of dollars in their early years as they try to build their fan bases. [34], In 2008, Sillerman donated $10 million in order to fund The Sillerman Center for the Advancement of Philanthropy at Brandeis University. The founder of SFX Entertainment rarely spoke about the impact of his daughter's death but his friends say it weighed on him and changed his outlook. Robert F.X. This ultimately led to the Telecommunications Act of 1996 allowing for ownership of multiple stations in single markets Capstar merged with Command Communications, another radio group Sillerman founded, ultimately changing its name to SFX Broadcasting. We dont have enough time on this call to talk about the mistakes I made, said Sillerman during a 30-minute phone conversation from his New York City home, his voice gravelly and occasionally interrupted by a breathing apparatus due to a past bout with tongue cancer. That business was built from a spree of acquisitions from 1997 to 2000 when Sillerman bought up Houston outfit Pace Concerts, New York promoter Delsener/Slater enterprises, Boston big man Don Laws Blackstone Entertainment, Los AngelesAvalon Attractions, Jack Boyles Cellar Door International, Bill Graham Presents in Northern California and Jimmy Koplicks 4,800-seat Oakdale Theater in Wallingford, Connecticut. Mr. Sillermans marketing talents emerged early. On Saturday, however, Sillerman was fielding questions on whether the company would go bankrupt--he said there was a zero percent chance--and admitting that he didnt work with the right people. Its also unclear if he was ever the right man for the job. As for spinoffs, did we mention that another smash hit on Fox, So You Think You Can Dance, is produced by Fuller too? Though these unfortunate events have more to do with the young generation experimenting with different ways of altering their consciousness while listening to music than the music itself, MDMA-based drugs have a certainly become a part of EDM culture. This company owned "American Idol" and the licensing rights to Elvis Presley and his Graceland estate. Connecting the show to phones, through the Internet, through merchandising, and ways I cant talk about yet.. It had earlier been trading on the NASDAQ exchange. A costly restaurant venture in Memphis went bust. I suppose there are all kinds of gratifying lines of work, he says. And thats just part of the American Idol money train. [7] The company was merged at the end of 1989 with a unit of Westinghouse Broadcasting in a then record-setting transaction worth $727 million. (Photo credit: Jonas Roosens/AFP/Getty Images). Ive tried to get him drunk to get him to tell me, says Brucie. Young Sillerman graduated magna cum laude from Brandeis in 1969 after becoming immersed in counterculture politics and rock & roll. The man who bought Elvis is Robert F.X. dialogue with Robert Sillerman. And dont even think about asking him what his middle initials, F.X., stand for. But when I took it to America, almost everyone rejected it, Fuller recalls. 19 is currently renegotiating the fee for next season, and some think the ante could be upped to $2 million per episode (though a reported flap over American Idol judge Simon Cowells compensation could be complicating matters). That means $125 million out of the $306 million paid for these two companies exceeds any tangible assets, including the value of trademarks. And there are a couple of Sillerman stories that involve nudity. In 2011, Apollo Management purchased CKX in 2011 for $512 million. Lawsuits increasingly became a common part of his life, including a suit from a luxury real estate firm for breach of contract after he allegedly cut the firm out of a $114 million real estate deal withoutpaying their commissions. Maglan Capital, an owner of roughly 1.5% of SFX Entertainment's outstanding stock, called Sillerman's $4.75 a share go private offer "a way low-ball bid." What kind of person would grow up to have business dreams like these? Thats not the basis of CKX. Part of that underwhelming reality may have to do with the public relations nightmares that can occur while running EDM festivals. 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