The UK’s Competition and Markets Authority (CMA) confirmed today (Tuesday) that Viagogo must sell all of StubHub’s business outside North America to satisfy the regulator’s concerns.
As reported previously in TheTicketingBusiness, Viagogo actually proposed selling off StubHub’s business outside North America in November as a possible solution after the UK watchdog provisionally blocked the $4.05bn (£3bn/€3.4bn) merger between the two resale rivals.
Today’s announcement comes nearly a year to the day since the CMA ordered Viagogo and StubHub to halt any further integration pending the completion of an investigation into the proposed merger.
A Phase 2 probe by the regulator found concerns that the transaction could lead to increases in fees for customers, including fans, who resell or buy secondary tickets to live events.
Today’s announcement means that StubHub’s international business – including in the UK – will be independently owned and run by a separate company, with no input from Viagogo.
Furthermore, the CMA will determine key conditions of the sale, such as the right of the purchaser to use the StubHub brand for the next 10 years. In November, Viagogo proposed that the buyer would be allowed to use the StubHub UK brand for only three years.
The watchdog will also approve the purchaser of the business before any sale.
In a statement released to TheTicketingBusiness.com, a Viagogo spokesperson said: “We are pleased to have found a remedy that is acceptable to the CMA that will allow everyone involved to move forward with clarity and certainty. Importantly, both Viagogo and StubHub will continue to provide a safe and secure platform for people to buy and sell tickets to events all over the world.”
A group of independent CMA panel members considered evidence from customers, competitors and other stakeholders, including consumer groups, before reaching its decision.
The regulator outlined how the combined businesses would have a market share of more than 90% in the UK without intervention and also looked at whether other distribution channels – capped-price ticket exchanges, classified advertising sites, social media and the primary ticketing market – would be able to compete strongly with the merged entity. The CMA said that none of the other channels would be able to stop the merged business from pushing up fees or reducing the quality of service.
“The CMA has focused on ensuring competition in this sector works best for UK consumers,” Stuart McIntosh, chair of the CMA inquiry group, said.
“After examining all the options, including unwinding the merger in full, the evidence shows that Viagogo selling StubHub’s international business will resolve our competition concerns, effectively and proportionately.
“Creating a fully independent StubHub international business will maintain competition in the UK and help ensure that the users of these ticketing platforms don’t face higher prices or poorer quality of service.”
The Face-value European Alliance for Ticketing (FEAT) posted its approval of the news on Twitter.“We welcome this decision, which will help protect the live sector across Europe from the concentration of power of the two biggest uncapped secondary sites,” it said. “When live resumes, it will be more important than ever that fans can see their favourite bands at the prices intended.”
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