(CelebrityAccess) — UK antitrust regulator Competition and Markets Authority (CMA) has ruled that the $4 billion merger between viagogo and Stubhub will lead to a substantial reduction in competition in the secondary ticketing market in the UK.
As a result, CMA ordered viagogo to divest itself of StubHub’s business outside North America, leaving in Stubhub’s international business units operated as a independently owned and run by a separate entity, with no input from viagogo.
However, under the CMA’s ruling, viagogo can retain Stubhub in the U.S. and Canada.
Viagogo announced it had acquired StubHub in February 2020 for a reported $4bn. StubHub’s ticketing business operates in a number of territories including North America, the UK and several countries in Europe, and South America and Asia.
According to the CMA, viagogo and StubHub collectively control 90% of the secondary ticketing market in the UK, and have “no significant competitors” in the market.
As part of their review, the CMA also evaluated the evidence on whether other distribution channels, including capped-price ticket exchanges, classified ad sites (like Gumtree), social media and the primary ticketing market itself, and determined they were not a significant source of competition with the merged Stubhub and viagogo.
“The CMA has focused on ensuring competition in this sector works best for UK consumers. 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,” McIntosh added.
The ruling is the latest challenge for viagogo from the CMA and expands on a proposal last year after the company faced controversy over alleged anti-consumer practices, its perceived relationships with ticket brokers, and for launching a legal battle against Ed Sheeran.