Online music marketplace Beatport has announced that it will discontinue a handful of its services in addition to suspending the auction process meant to partner it with a new parent company indefinitely. After being famously mismanaged by EDM conglomerate SFX Entertainment, the company was already supposed to have been sold off as part of SFX’s chapter 11 bankruptcy restructuring.
A post to the blog section of the Beatport website reveals that effective May 13th, the streaming platform, mobile app and Beatport News will no longer be among its services. It goes on to explain that the decision was made to channel resources to the marketplace’s flagship download service.
The statement doesn’t offer any insight as to why the auction process had to be suspended, although one possibility is that the firm overseeing the auction, Moelis & Company LLC, did not receive enough qualified bids to proceed with the sale, and as a result the company must downsize to cut costs.
However, it bears mentioning that the blow dealt to SFX Entertainment when Dutch promoter Alda Events recently seized its assets forced the former company propose a settlement to the bankruptcy court. Being that the proposal was issued on the same day that Beatport’s sale to a bidder was scheduled to be announced, it’s possible that logistical details pertaining to SFX’s uncertain cash flows played a role in the postponement and service changes.
Beatport was supposed to be the first asset auctioned off by SFX Entertainment during the restructuring. If the current state of affairs is an indicator of what’s to come, perhaps filing under chapter 11 of the Bankruptcy Code will prove to have been an overly optimistic course of action.
Published: May 10, 2016 03:26 pm