Gateway had no revenue in 2009 or 2010 and no employees except for a CEO, according to a regulatory filing. The company is traded on the pink sheets market, and upon the announcement of Sillerman's planned acquisition, its share price increased more than 25,000% to about $2.60 in midday trading.
Sillerman will rename the company Function (X) and it will have a new trading symbol. He is paying $3.6 million for it, along with other investors.
In 2005, Sillerman launched CKX as a base to start a new venture. And he built it into the owner and operator of businesses such as 19 Entertainment, which controls the "Idol" brand globally, and the entity that controls Elvis Presley's image and Graceland. He left last year and his attempt to buy the company failed.
The 62-year-old Sillerman has previously led companies specializing in owning radio stations and operating live events before selling both.
Sillerman received a $3.4 million severance payout and $1 million consulting contract when he left CKX.