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Sillerman buys shell, shares soar 25,000%

By GARETT SLOANE

Last Updated: 1:42 AM, February 9, 2011

Posted: 12:23 AM, February 9, 2011
Comments: 0
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The founder of the company which owns "American Idol" has just taken another no-name to new heights.

Robert F.X. Sillerman took control of dormant public company Gateway Industries yesterday and sent its stock soaring from about 2 cents a share to nearly $3 after he said the company would be the launching pad for a new venture.

That's a 25,000 percent gain.

The deal for Gateway, whose sole employee is CEO Jack Howard, gives Sillerman and other investors a 98 percent stake in the company after they bought 120 million shares at 3 cents each, for a total of $3.6 million.

The newly constituted company will be called Function (X), but Sillerman is being coy about what his next move will be.

Gateway's shares closed yesterday at $1.89 after giving back a third of their gains in the afternoon. Gateway had no revenue last year and a total of $5 on hand.

Reps for Sillerman said he would not have further comments. Howard did not return calls.

Sillerman, 62, is best known for being the CEO of CKX when that company bought 19 Entertainment, the firm that developed "American Idol." Sillerman, a native New Yorker, is considered to have the golden touch in the entertainment industry.

He sold his concert promotion company SFX Entertainment to Clear Channel Communications for $4 billion in 2000.

Five years later, he orchestrated the deal to buy Entertainment 19 for a steal: $160 million.

Read more: http://www.nypost.com/p/news/business/sillerman_buys_shell_shares_soar_iR6IbzjJC0Qv1Blx09qUHN#ixzz1F7KvOtq2


http://blogs.wsj.com/deals/2011/02/08/american-idol-backer-robert-sillerman-launches-new-media-venture/