All Shook Up Over Graceland Deal
The pilgrims will still weep at Elvis Presley’s grave, and the souvenir shops will still swarm with credit-card-waving fans, an occasional black pompadour hardly drawing a glance.
But change is in the air: Strangers are in Graceland.
Lisa Marie Presley has sold the business side of her father’s estate and turned over his famous white-columned house to CKX Inc., an entertainment company that also owns the “American Idol” TV show.
Now, some of the fans who flock to Memphis each year to commemorate Presley’s death on Aug. 16, 1977, are worried that their annual homecoming won’t be quite so homey.
“They call themselves a company now,” said Jean Donovan, a fan from Derry, N.H.
In fact, Elvis Presley Enterprises was already a company. Forbes listed Presley as the world’s top-earning dead entertainer last year.
Graceland managers say the Elvis business, which brings in $40 million a year, is poised to grow even more. CKX says it’s looking into “Elvis-related attractions” in places such as Las Vegas, Asia, the Middle East and Europe. No details have been announced.
“Elvis sells all over the world, and that’s where the real opportunity for growth lies for us, to take more of Elvis and Graceland out to the world,” said Jack Soden, chief executive of Elvis Presley Enterprises Inc., now a subsidiary of New York-based CKX.
Soden oversaw Graceland’s opening in 1982, and he’s staying on the job. But the Elvis faithful are ever watchful for hints of change at Graceland, where Presley is buried in a small garden.
“I know a lot of the older fans are in an uproar,” said Kathie Bryson, a fan from St. Louis. “But then, anything that changes down there puts them in an uproar.”
Elvis won’t be the only American idol in the stables of CKX, a firm founded by Robert F.X. Sillerman, an investor who specializes in media and entertainment.
A month after the Elvis deal, CKX acquired 19 Entertainment, the British company that produces the TV show “American Idol” and its British predecessor, “Pop Idol.” CKX also has an agreement to buy MBST, a Hollywood talent management company, and expects to make other acquisitions.
CKX says its strategy is to buy companies that control “established entertainment content” -- which could include music, TV, films and video games -- and then to enhance the value of those companies.
Sillerman was also a founder of SFX Entertainment, a group of sports promotion and live concert properties that sold to Clear Channel Communications Inc. for more than $4 billion five years ago.
Bishop Cheen, an entertainment analyst for Wachovia Securities, said Sillerman would probably focus on his control of the rights to Presley’s name and leave the day-to-day operations of Graceland alone.
“He’s not known for sacking and burning and pillaging,” Cheen said. “He is known for adding value and taking profits.”
The company went public this year by buying an inactive public company, Sports Entertainment Enterprises Inc. Sillerman changed the name to CKX -- for “Content is King,” with a final “X” as a signature of his businesses -- and simultaneously bought the Presley business in February for about $100 million in cash and stock.
The company raised $235 million in an $11-a-share stock offering in June. All but about $50 million went to pay debt, including the cost of the Elvis business. Shares have been trading recently from $13 to $14 a share.
Lisa Marie Presley got $50 million at the sale plus stock in CKX and kept a 15% interest in Elvis Presley Enterprises, along with title to Graceland and her father’s personal possessions. Priscilla Presley, Lisa Marie’s mother and Presley’s widow, got $6.5 million and a 10-year consulting contract with CKX at $560,000 a year. She is also on the company’s board of directors.
When Presley died at age 42 of prescription drug abuse and heart disease, his finances were in sad shape.
But led by Priscilla Presley, the estate formed Elvis Presley Enterprises, opened Graceland to the public and began a campaign to solidify the legal rights to make money on Elvis’ name and image.
Now it’s CKX’s job to keep that going. Soden said he didn’t expect CKX to make major adjustments in how Graceland and its complex of souvenir shops and museums were run.
“They said when we were getting to know them, ‘You know, we’re not out trying to buy problems. We don’t want to buy companies that we have to fix,’ ” Soden said.
For the fans, there’s little concern that Elvis’ light will dim. They worry instead about access to Graceland and whether an expanding marketplace will show Presley the reverence they believe he deserves.
“We’re all just waiting to see what changes, if any, will be made,” said Jeanne Kalweit of the Elvis Presley TCB Fan Club of Chicago.