Update (as of April 17, 2020): A Viagogo spokesperson commented on the investigation:
“We welcome the formal start of the phase 1 review by the CMA. We will continue to work closely with them and demonstrate the benefits of the merger for consumers.”
The UK’s Competition and Markets Authority (CMA) has moved into an active phase of its investigation of Viagogo’s $4 billion purchase of ticket resale site StubHub.
Last November, Viagogo revealed that it would move forward with a deal to purchase StubHub following widespread speculation across the industry. The CMA warned Viagogo it had been considering a probe, however, the company moved forward with the payment, which was partially funded by loans from the Walkton dynasty. Late last year, the CMA launched an investigation into the merger, looking at whether or not the deal will lead to “a substantial lessening of competition” in ticket selling.
According to The Guardian, the competition watchdog has now launched a full investigation, which is slated to last through June 11. The CMA could ask the company to allay competition concerns by selling part of the UK operation or launch a second inquiry that could result in the deal being blocked altogether.
Groups have been campaigning against the merger, including FanFair Alliance. The group’s spokesman, Adam Webb, said the CMA should block the deal as “two negatives don’t make a positive.”
“This […] merger would consolidate their market power and, in the UK at least, create a single monopoly platform for the commercial resale of tickets,” Webb said. “That scenario should set alarms ringing. It would also risk undoing much of the progress we’ve seen to reform this sector.”
This active investigation has launched in the middle of the ongoing coronavirus pandemic. During this trying time, both sites are suffering, and StubHub has pushed for a bailout from the U.S. government to help them through the crisis. Late last month, StubHub announced a change to its refund policy, noting that it would only be offering vouchers worth 120% of a ticket to customers, rather than a refund. This has since sparked a $5 million class action lawsuit from frustrated fans.
The live event industry as a whole has taken a hard hit amid the global outbreak; a new report from Pollstar shows that the industry will be down $9 billion in revenue this year. Additionally, a healthcare expert predicted that live events will not fully return until fall 2021.
Last Updated on April 17, 2020 by Olivia Perreault