SFX Enters Ticketing Business with $16.2 Million Acquisition of Europe's Paylogic

In a continuation of its digital expansion, SFX Entertainment has entered into the live event ticketing business with the acquisition of European ticketing company Paylogic.

SFX has purchased 75% of Paylogic for about $16.2 million. The ticketing company as a whole is valued at approximately $22 million.

Having already provided ticketing services for numerous European music events promoted by ID&T (which was acquired by SFX earlier this year), Paylogic made its U.S. debut in September with TomorrowWorld in Chattahoochee Hills, Ga. Featuring headlining performances by Steve Aoki, Armin Van Buuren and David Guetta, the three-day EDM festival drew more than 120,000 people.

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“Our principle interest was in acquiring a company that could absolutely handle massive surges, as we experienced, for instance at TomorrowWorld,” SFX chairman/CEO Robert F.X. Sillerman tells Billboard.biz. “As we examined the landscape, we landed on Paylogic as the logical player.”

In addition to TomorrowWorld, Paylogic has also provided exclusive ticketing services to SFX brands such as Sensation, Mysteryland, Q-dance, Tomorrowland. Going forward, it’s not yet clear which SFX events Paylogic will provide ticketing services to, Sillerman says. He adds that Paylogic won’t immediately become the exclusive ticketer for SFX.

“It seems logical, although frankly we’ve haven’t made that firm decision,” Sillerman says. “One of our companies, Disco Donnie Presents, has a multi-year contract with Eventbrite. That, of course, will continue. But it seems logical, then, that over time Paylogic will be our principle, if not exclusive, ticketing solution.”

With some 2,000 clients and offices in Amsterdam, Groningen, Berlin and Antwerp, Paylogic has sold more than 20 million tickets throughout Europe, Latin America, Asia, Africa and the United States. Outside of SFX, Paylogic will continue to be a white-label service provider.

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“We’ve been doing ticketing in many other continents except for North America, where we’ve only done TomorrowWorld, which was pretty good marketing success. We believe we can take it to the next level,” Paylogic chief commercial officer Jan Willem van der Meer tells Billboard.biz. “Besides what we’re doing, SFX has shown a much broader interest in many strategies in the market. We’ve been surprised by the creative ideas and we’d love to be part of that bigger plan.”

In late October, SFX announced three other deals to bolster its digital portfolio: agreements to purchase Tunezy, Arc90 and Fame House. Those companies join a portfolio that already includes EDM-focused download store Beatport, which SFX purchased last year.

Sillerman says SFX is exploring other digital acquisition opportunities, but declined to reveal specific details.

SFX has also recently announced the acquisition of German promoter i-Motion and Australian promotor Totem OneLove Group, as well as a new deal with Rock in Rio. In late November, in its first earnings report as a publicly traded company, SFX Entertainment posted a net loss of $28.6 million on revenue of $48.7 million.

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