Aussie Promoters Down $8.4M After Festicket Collapse
The true cost to Australian creditors following the collapse of U.K.-based global festival-package company Festicket has been revealed.
Four Australian companies were down A$8.4 million (£4.7 million).
They were Festco at $4,222,086. (£2,359,827), Lost Paradise at $2,827,380 (£1,580,292), Global Gathering at $1,257,583 (£703,113) and The Hour Group at $187,260 (£104,704).
This was a total of $8, 494,189 or £4,747, 936.
The figures came from a new filing with Companies House, the U.K.’s registrar of companies which companies have to provide financial statements by law.
They were first published by U.K.-based global live music publication IQ.
The documents showed that Festicket owed more than A$40.2 million (£22.5 million) to global creditors at the time of its collapse.
Significant creditors included Event Horizon at $4,098,772 (£2,290,244), AEG Presents at $2,695,753 (£1,506,352) and Slammin Events at $2,410,003 (£1,346,679) in the UK, and Spain’s Mad Cool at $2,713,712 (£1,516,613).
Others included Amnesia, Primavera Sound, Cosmopop, Croatia’s Electronic Events, Malta Tourism Authority and Loveland Events in the Netherlands.
IQ noted that Festicket’s credit card processor, Stripe, holds $13.7 million (£7.69 million) across multiple currencies but has said, “The level of any recoveries in relation to this sum are currently uncertain and will depend on a number of factors”.
Some creditors complained that they expected that once Festicket deducted its booking fees, the remaining ticket money should be held in a client account and therefore not touched.
Bristol club Motion, owed $536,867 (£300,000) posted on Facebook that this had not happened.
“We are now being told that key assets are being sold off and the debt stands to be ‘liquidated’”.
As reported by TMN U.S.-based ticketing exchange and technology firm Lyte has bought out the business and some assets of Festicket and its subsidiaries Event Genius and Ticket Arena for $178,816 (£100,000).
The nine-year-old company now plans to expand into Australia, the U.K., the European Union and Latin America using the assets and staff of the acquired platforms.
Lee Manning of Festicket administrator ReSolve Advisory said in a report, “We understand it is the purchaser’s intention to carry on the business of the company.
“We expect that this will reduce the risk of future event cancellations in relation to events for which tickets have been sold, and therefore improve the overall outcome for creditors.”
Festicket was founded by Zack Sabban, Jonathan Younes and Jerome Elfassy in 2011.
It worked with festivals as official partners to provide general admission and VIP tickets to festivals around the world.
These tickets are bundled together with travel, accommodation and various other add-ons.
According to its website, it worked with over a thousand festivals in 50 countries and serviced 800,000 travellers since 2012.
In July 2021, its financials showed losses of $15,328,114 (€8,976,888) for 2020 and ($22,085,566 (€12,934,107) for 2019.
Festicket launched in Australia in 2018, with partnerships with Beyond The Valley, Jungle Love, Lost Paradise, Wildlands and For The Love.
It later added Promiseland and The Grass Is Greener.
At the time it planned to invest heavily in local talent, resources and tech partnerships as part of its plans to build a stronger domestic presence and hired senior account managers.
One early Australian victim of the collapse was October’s Borderline Music & Arts Festival in Wodonga, Victoria which blamed Festicket’s woes as primarily the cause of its cancellation.