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News of the deal drove shares of SEE (ticker: CKXE) up some 58% Friday on Nasdaq, where they're currently trading at around $24.
ROBERT F.X. SILLERMAN
BUYS AMERICAN IDOL
Simon Fuller’s 19 Entertainment to Be Part of Financier’s Content Kingdom
Whoo-wee: It feels like 1999 again. Robert F. X. Sillerman, whose company SFX rolled up virtually every major concert promoter in the U.S. before selling them all to Clear Channel in 2000, is on the move again, this time buying American Idol creator Simon Fuller’s 19 Entertainment for a reported $161 million in cash and 1.87 million shares of Sillerman’s latest company, Sports Entertainment Enterprises.

News of the deal drove shares of SEE (ticker: CKXE) up some 58% Friday on Nasdaq, where they're currently trading at around $24. By the way, SEE is in the process of changing its name to “CKX,” where the C and K stand for “Content is King” (more on that later). Didn’t we tell you it felt like 1999?

In addition to American Idol in the U.S. and its forebear Pop Idol in the U.K., Sillerman is also buying 19 Entertainment’s artist-management contracts, which include current and former Idol contestants, former Eurhythmic Annie Lennox and soccer star/Mr. Posh Spice David Beckham. The deal calls for Fuller to remain 19E’s President for six years.

American Idol is now in its fourth season, and has seen increased ratings each year. This time, it has been drawing an average of 26 million viewers each Wednesday, which represents an 8% increase over 2004 and a 20% increase over 2003, according to the New York Times, citing Nielsen Media Research data.

Many of Idol’s top contestants have become solid sellers with their first albums, including Kelly Clarkson, Clay Aiken, Ruben Studdard and Fantasia Barrino.

Sillerman told the Times that he’s into acquiring content now because he sees platforms such as on-demand television, computers and various handheld devices as the future. The thought that video entertainment is the sole domain of television “is as archaic as the thought the thought that music can only be distributed on a CD.”

As for Sillerman’s new company name CKX, observer will note that it features three letters, including an X (his second middle initial), much like SFX did. The Times reports that the name was explained in a recent SEC filing: “Management believes that a short name consisting of three letters is an easy way to create brand identification,” the filing reads, in part. “They have chosen ‘C’ and ‘K’ to stand for ‘Content is King.’”

The 19E deal is Sillerman's second high-profile move since his attempt to buy artist-management company The Firm failed to gel several years ago. He announced in December that he was buying 85% interest in Elvis Presley Enterprises, and rumors have since surfaced that plans for an Elvis-themed casino in Las Vegas may be in the works.

Bear Stearns loaned Sillerman $109 million to finance the 19E acquisition.

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