Penske Media Corp., the publisher of magazines such as Rolling Stone, Billboard and Variety, agreed to acquire a 50% stake in South by Southwest, the famous technology, music and film festival, according to people familiar with the matter. .
The Texas festival, one of the largest and best-known in the United States, received a severe financial blow last March after it was canceled at the last minute by Austin city officials due to the pandemic eruption of coronavirus.
Organizers said at the time that their insurance policies did not cover cancellation due to a pandemic. They believed the cancellation would cost them millions, raising questions about the future of the festival, which is also known as SXSW or simply “Southby”. Last spring, SXSW laid off a third of its 175 employees year-round.
This year, organizers only organized an abbreviated virtual event, but said they intended to host the event in person in 2022.
Penske will make a strategic investment in the closely established company, SXSW LLC, in exchange for a 50% stake in the business, according to People. The event had been owned by its founders who created the festival in 1987. They will continue to manage and operate the festival, although Penske will own the largest stake, according to people.