The UK's Competition and Markets Authority (CMA) has advised ticket resellers StubHub and Viagogo to halt any integration of the two businesses until it has finished investigating the proposed merger.
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The $4bn 'Stubagogo' merger would give the new company control of over 90% of the UK's secondary ticket inventory, the CMA has found
By IQ on 22 Oct 2020
The Competition and Markets Authority (CMA) has found that the acquisition of StubHub by Viagogo will reduce competition in an “already very concentrated market”, throwing into doubt the fate of the already completed deal in the UK.
The UK competition watchdog opened an in-depth, ‘phase 2’ investigation of the merger in June after finding competition concerns during its initial probe.
According to the CMA’s provisional decision, with Viagogo and StubHub now the only two companies of “material size” in the British ticket resale sector, the merged outfit would have a market share of more than 90%.
The authority is concerned the merger could lead to higher fees for fans (both selling and buying), as well as “a lower quality of service and reduced innovation in the sector”.
Stuart McIntosh, chair of the CMA inquiry group, comments: “The evidence we’ve seen so far consistently points in the same direction: that Viagogo and StubHub have a market share of more than 90% combined and compete closely with each other. We are therefore concerned that their merger could lead to secondary ticketing customers facing higher fees and lower quality services.
The CMA has suggested the sale of StubHub by Viagogo in the UK
“We’re now inviting comments on our provisional findings and possible remedies.”
Among the options floated to address the CMA’s concerns is the sale, either partial or whole, of StubHub by Viagogo on a global basis, which would leave Viagogo as an effective monopoly in many markets.
Adam Webb, campaign manager for anti-ticket touting group FanFair Alliance, says: “FanFair Alliance welcomes today’s provisional findings. Though poorly timed and focused predominantly on the US market, Viagogo’s $4.05bn acquisition of StubHub raises acute competition concerns in the UK. We are pleased the CMA has recognised this.
“Ultimately, the merger would bestow a hugely controversial business monopoly status in this country, and risk unpicking some significant progress made over recent years to clean up the secondary ticketing market. We now look forward to submitting further views to the CMA about both their findings and potential remedies.”
A Viagogo spokesperson says: “Our intention remains to provide eventgoers in the UK with the best possible service, and whilst we disagree with the provisional conclusion that the deal would reduce competition, we look forward to working with the CMA to deliver a comprehensive solution which addresses their concerns.”
The deadline for comments on the CMA’s provisional findings is 5 November 2020. Written representations can be made to [email protected].
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