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UK regulator rejects Viagogo’s StubHub offer

The UK’s competition watchdog has rejected a proposal by Viagogo to sell StubHub’s European entities to ensure its $4.05bn acquisition would be approved.

The offer was made last month as Viagogo sought to appease the Competition and Markets Authority’s (CMA) competition concerns ahead of an in-depth Phase 2 investigation being announced.

After being notified about the investigation, Viagogo was given five working days to address the CMA’s concerns about the merger potentially resulting in customers who buy and resell tickets “losing out as a result of higher prices and fewer options.”

During this time, Viagogo proposed the divestment to an upfront buyer of StubHub’s European and certain other international legal entities.

The CMA rejected the offer, noting it generally prefers divestiture of complete businesses to ensure they can compete effectively on a stand-alone basis. It said that the proposition did not offer a “clear-cut solution” to competition concerns.

The CMA document reads: “The CMA considers that there is a significant risk that the Proposed Undertaking would not restore competition to the level that would have prevailed absent the merger and would not fully address the significant competition concerns identified in the SLC Decision without the need for further investigation.”

It also notes testimony from resellers stating that many view Viagogo and StubHub as the best alternatives to each other, with “no credible alternatives” available following the merger.

Viagogo told TheTicketingBusiness it currently had nothing further to add.

In announcing the Phase 2 investigation in June, the CMA said that the acquisition could result in a “substantial lessening of competition” based on the information it currently has. The investigation will conclude and decide on the future of the deal by December 9, 2020.

Viagogo completed its $4.05bn purchase of StubHub from parent company eBay in February. Around the same time the CMA ordered a halt to any integration between the companies until it completes its investigation into the merger.

The two companies’ combined market share accounts for more than 80 per cent and they are the top two players respectively in the UK.

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