In a recent conference call with investors, IAC/InterActiveCorp, parent company to Ticketmaster, suggested that their Ticketmaster unit was unlikely to show significant growth in the first quarter compared to an unexpectedly strong first quarter last year. This was hardly good news following IAC’s $370 million loss in the fourth quarter, mostly caused by a large write off at its home mortgage subsidiary Lendingtree.com. The company’s stock was down as much as 10 percent for portions of this week.
This only adds to recent woes, as analysts have been concerned about the financial prospects for the upcoming spin off of Ticketmaster, HSN, Interval International, and LendingTree. This is exacerbated by the pending expiration of the ticketing deal between Ticketmaster and Live Nation, as Live Nation prepares to do its own ticketing. Live Nation was Ticketmaster’s largest client, accounting for about 14 percent of Ticketmaster’s revenue.
In the ticket market, Ticketmaster’s position remains sound; it is the largest primary ticket reseller, according to TicketNews’s exclusive rankings, and the company is about to acquire the second-largest secondary ticket company TicketsNow, pending government approval.
The matter has become even more complicated now, as IAC’s majority shareholder, Liberty Media, has sued IAC over voting rights related to the upcoming spinoffs of the four divisions. Under the current agreement, Liberty exercises nearly 62 percent of the votes in IAC, although the company holds only 30 percent of its stock. In December, Liberty Media had been rumored to be interested in purchasing Ticketmaster.
IAC faces additional pressure outside of Ticketmaster. The Microsoft bid to buy Yahoo has sent ripples through the tech stocks. On the same recent conference call, IAC CEO Barry Diller was asked about the possibility of an IAC merger with AOL. While Diller said that it was an unlikely possibility (especially with the current lawsuit freezing major decisions), the New York Times’ editor of the Bits blog, Saul Hansell, wrote that he sees such an arrangement as a solid plan for a post-spinoff IAC trying to survive in a world dominated by Google and Microsoft-Yahoo.
