(Could this be DREAM’s swan song?)
For months Fight Entertainment Group (FEG) executives have denied persistent rumors that the Japanese combat sport promotion firm is in trouble. Now one employee who works stateside has finally admitted that there is a crack forming in the facade perpetuated by DREAM and K-1 officials.
Mike Kogan, FEG’s U.S. representative today told MMAJunkie that the company is holding its breath while it waits for the results of an audit being done by potential investor, PUJI Capital, which will determine if the organization will receive the funding necessary to resume operations.
According to Kogan, the Japanese investment bank is attempting to raise $230 million for the cash-strapped company, that has been accused of owing hundreds of thousands of dollars in unpaid fight purses spanning more than three years worth of events.
He says that the plan was to earmark the money to execute K-1 and DREAM events over the next five years, but if the company doesn’t receive the full amount, which is looking more likely as time goes by, the projected timeline of events planned by FEG may be dramatically shortened.
Although many have cited news last week that the company had canceled a planned DREAM 17 event tentatively scheduled for Oct. 25 in South Korea as proof positive that FEG was likely on its last legs, Kogan says the reason for the event being scrapped was that DREAM lacks any Korean star power, which led to slow ticket sales.
"Basically, it’s very simple; we don’t have any Korean stars – nobody who’s enough to attract super strong ticket sales," he says. "So what’s the point of going into Korea?"
Closing out 2010, Kogan says FEG is planning only two major shows and is keeping its hand close to its chest before deciding to go all in or fold. DREAM16, is tentatively set for September 25 in Nagoya, Japan and K-1 Dynamite!! 2010 will take place as always on New Year’s Eve, likely at the Saitama Super Arena. The 2010 K-1 Grand Prix Final 16 show is also set for event on Oct. 2 in Seoul, Korea.
Though he wouldn’t say how dire the situation is, Kogan admits that FEG won’t be long for this world if the PUJI deal falls through.
"Are you asking me if we’re going to be in business after Dynamite? I don’t know," Kogan says. "It’s very difficult. Obviously, we’re short on revenues, and we need to – besides restructuring – we need to be able to find new sources of revenue.You need money to make money, so to speak. I don’t sit in on the financial meetings. But it’s very challenging.We need investment money. That’s the bottom line."
He explained that the Japanese execs seem optimistic, despite the rumors and the extended amount of time the audit is taking and he says has been kept abreast of the goings on in "The Land of the Rising Sun," but Kogan isn’t sure if he’s being told everything or if they are just trying to hide the signs of the company’s imminent doom.
"I know that there are various companies that PUJI has already spoken to that have shown tremendous interest, and there’s been ongoing conversations. There have been a few near misses where we were almost heavily invested (in) by some companies over the years. I think there’s interest, but I don’t know 100 percent what’s going on. FEG is a complicated company and machine that comes together by a lot of different pieces coming together, and the biggest piece of it is that we’ll never understand is the way that Japanese culture works, and the way they do things," he says. "Where I have no problem telling somebody to go [expletive] themselves, they wouldn’t, and (they) end up spending money on something we really shouldn’t be. You know what I mean? It’s just a different culture. They don’t operate necessarily how we do. That’s just my opinion. If this is our last year, then I need to go look for another job."