Synergy Global Entertainment, the independent concert promotion company started by John Reese, has filed for Chapter 7 bankruptcy protection. The filing reveals the company owes $8.4 million to its creditors.
The company is behind many major music festivals such as Ozzfest Meets Knotfest and this summer’s first Rockstar Disrupt Festival.
According to Billboard, lawyers for the company filed for bankruptcy protection in U.S. Bankruptcy Court in California’s Central District.
The filing states SGE owes $8.4 million to its creditors, with $1 million in assets and $54,000 in the bank.
Reese reveals he had hoped to expand in 2019 after growing by more than 30% in 2018. However, significant loss from the Disrupt Festival, which canceled a handful of dates and downgraded venues for undisclosed reasons at the time, and the cancellation of Mad Decent Block Party Festival hit the company hard.
“After having creative impact in over 45 Festival Brands and Tours in the company’s history, we most appreciate the years of partnerships with fans, artists, brands and vendors,” Reese writes in a statement to Billboard.
Listed as the company’s only secured creditor is Ash Avildsen, founder of Sumerian Records. Avildsen loaned Reese $1 million on June 24 after SGE faced “a liquidity crisis” and “needed help.”
“All of his summer events were already booked and on sale so there was no time to do proper due diligence. Hence it was a very risky investment but I care about John and the SGE family dearly,” he writes.
You can read Reese’s statement on the bankruptcy below.
It is with deep regret and after exhaustive efforts to save the business, SGE is now closed.
“After 15 years as a successful festival promoter, SGE was hit by a perfect storm of adverse market conditions and a massive drop in ticket sales and RPT (Revenue Per Ticket) since late April of this year compared to historical ticket sales metrics. As a result of these issues, the negative economic impact for SGE became untenable.
After having creative impact in over 45 Festival Brands and Tours in the company’s history, we most appreciate the years of partnerships with fans, artists, brands and vendors”
The full bankruptcy filing can be found here.