Viagogo forced to break up Stubhub after $4bn takeover
Viagogo must sell all of Stubhub’s operations outside the US to satisfy competition concerns over its $4bn (£2.9bn) takeover, regulators said today.
A probe by the Competition and Markets Authority (CMA) found that the deal would lead to a substantial reduction in competition in the secondary ticketing market and potentially result in higher fees or poorer service in future.
Together Viagogo and Stubhub make up more than 90 per cent of the ticket resale market and are the number one and number two players in the UK respectively.
The CMA today said Viagogo must offload Stubhub’s business outside North America, which includes the UK and several countries in Europe, as well as South America and Asia.
The watchdog will determine key conditions of the sale, including the right of the purchaser to use the Stubhub brand for the next 10 years. It will also be required to approve the buyer before any sale.
“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,” said Stuart McIntosh, Chair of the CMA inquiry group.
“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.”
Viagog 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.”
The CMA’s investigation found that other ticket distribution channels, such as capped-price ticket exchanges, classified ad sites like Gumtree, social media and the primary ticketing market itself, would not be able to compete with the newly-merged company.
The regulator added that it was mindful of the impact of Covid-19 on the live events industry, but concluded that both Viagogo and Stubhub would remain important competitors when the sector recovers.