SFX Entertainment (NASDAQ:SFXE), the concert promoter which considered bankruptcy filing last week, said it secured $20mln in new financing for itself and certain of its operating subsidiaries. Shares surged.
The New York-based company said in a statement on Friday that the financing helps it obtain capital for its working and general corporate purposes.
On January 7, SFX said in financial documents that it received a waiver of defaults on $30 mln in debt through Jan. 28.
According to the documents, the company hired turnaround firm FTI Consulting Inc. to help it examine restructuring options that may be executed in bankruptcy.
Earlier this week, Moody's Investors Service (Moody's) downgraded SFX Entertainment’s corporate family rating to Ca from Caa3 and downgraded ratings for SFXE's second lien senior secured notes to Ca from Caa3.
The rating action was prompted by Moody's assessment that the probability of a near-term default, is now very high.
Last year, SFX noted in regulatory filings that it may not have sufficient cash to fund its debt obligations during 2016.
The company has $312.6mln in debt, mainly senior bonds due in 2019. As of Sept. 30, the date of SFX’s most recent earnings report, the company had $59.8 million in cash on hand.
Shares of SFX were trading up 83% at $0.145 at 11:18 a.m. in New York.