MUMBAI: Glancy Prongay & Murray LLP (GPM) issued a statement it is investigating potential claims on behalf of investors of SFX Entertainment, Inc. (SFX or the Company) concerning the Company’s and its officers’ possible violations of federal securities laws in connection with SFX CEO’s alleged recklessness or fraud in proposing a sham purchase of the Company’s outstanding stock.
SFX engages in the production of live events and digital entertainment content that focuses on the electronic music culture (EMC) and other festivals. GPM’s investigation focuses on whether the Company made materially false and misleading statements in connection with the proposed acquisition of SFX by Robert F.X. Sillerman, SFX’s CEO and largest shareholder, for all of the outstanding common stock he did not already own. However, Sillerman failed to disclose that he allegedly did not have any financing in place at the time he made his proposal and knew or recklessly disregarded that he could not obtain the financing to complete the transaction. Sillerman’s proposal was allegedly a sham offer to increase the value of the Company’s shares, in the fact of the Company’s increasing debt and decreasing margins.
Following the news that Sillerman would no longer consider purchasing the Company, shares of SFX have declined sharply in value.(This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.)
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