Stereosonic founders owed millions from SFX Entertainment
Five of the original owners ofTotem OneLove Group,the Australian subsidiary thatpreviously promoted Stereosonic festival, are owed $15 million from the festival’s current owner.
In 2013 Richie McNeill,Frank Cotela, Dror Erez, Simon Coyle and Peter Raff soldStereosonic to SFX Entertainment for $75 million. Cotela went on to wholly acquire independent label OneLove shortly after the sale to SFX.
TMNunderstands that while they have been paid the bulk of the cash owed by SFX as part of the acquisition, Cotela and the four original owners have employed lawyer David Vodicka,the principal of entertainmentlawfirm Media ArtsLawyers,to represent them in New York.
Vodicka told TMN the money owed forms part of the creditors of SFX Entertainment, which is presently in chapter 11 bankruptcy. Other creditors owed money by SFX include Alda Events, Made Events, React Presentsand PRSfor Music.
Cotela has been appointed to the creditors committee, which represents the interests of all creditors.
SFX Entertainment’s highly-publicised global collapse was felt in Australia in April, whenit announced the 2016 Stereosonic festival would not go ahead.At the time, a spokesman for the event said Stereosonic would return in 2017 but as reported inTheMusicthis week, SFX Totem Pty Ltd – SFX’s subsidiary and the promoter of Stereosonic – has enteredadministration.
According toTheMusic, the promoter’scompany staff will be finishing up “by week’s end at the latest”.
It should be noted here thatCotela’s music company has no connection to Totem OneLove Group; the Group is retained by the five original owners but no longer trades and will be wound up shortly.
In late JanuarySFX filed for chapter 11 bankruptcytoremove more than US$300 million from its outstanding debt and to take the company private. At the time of SFX’s bankruptcy announcement, Stereosonic released a statement to note it would not affect its local operations.
As reported in TMN yesterday, Cotela’s Melbourne-based independent label OneLove has expanded to include several new operational arms, including publishing, A&R, management, live touring, and in-house public relations. Ant Celestino heads up Onelove A&R division which will now include two new imprints “Club Love” with Robert (Pix) Piccolo and “WVS” with Sydney producer Miracle. Melissa Jong has joined to head artist management and Christina Rinaldi is the in-house publicist. Cotela will continue with touring and festivals.
Michael Parisi of Michael Parisi Management will oversee its publishing joint venture with Mushroom and will act as consultant for other parts of the company.
According to Mixmag,Richie McNeil’sHardware Corporation is currently planning two new festivals, one set to take place in December and another camping event slated for 2017.