More than a year after StubHub’s purchase by Viagogo was announced, the merger is expected to begin moving forward once again with the blessing of the Competition and Markets Authority of the UK.
The competition regulator said it “proposes to accept” a plan for StubHub to spin off its non-North American entities, allowing Viagogo to take over its core business while the international units become competitors. The proposed solution to competition concerns raised by the $4 billion merger was first announced earlier this year.
We’re consulting on proposals requiring viagogo to sell all of StubHub’s business outside of North America, after our in-depth investigation identified competition concerns.
— Competition & Markets Authority (@CMAgovUK) March 22, 2021
Viagogo, owned by StubHub co-founder Eric Baker, emerged as the surprise winner in the StubHub sale process a year ago, after eBay was pressured by activist investors to spin off its ticket resale subsidiary and market leader. But the CMA quickly challenged the merger, finding that it would “lead to a substantial reduction in competition in the secondary ticketing market in the UK.” Much of the last year has been spent with StubHub stuck in limbo, maintaining independent operations from its new parent company as the pandemic halted nearly all business.
According to the plan green-lit by the CMA, Viagogo must find a buyer for StubHub’s international businesses that are independent of Viagogo and have the financial resources to run the company as a viable competitor in the uncapped secondary ticketing marketplace space.
Anti-resale industry spokesman Adam Webb of the FanFair Alliance was quick to point out the difficulties of finding a potential buyer in the current climate. “This might prove easier said than done, ” said Webb, whose oganization has long served as a perpetual cheerleader for any and all setbacks that Viagogo has seen in its purchase of Baker’s former company, which capped resale marketplaces such as Twickets (which counts FanFair Alliance founders among its core investors) hope to see thwarted. “Since the CMA’s buyer criteria demands that anyone taking on StubHub’s loss-making international business will be forced to run the site as (a) an uncapped ticket resale platform and (b) in direct competition to Viagogo UK.”
No prospective purchasers for the international StubHub businesses have been identified publically. Ticketmaster had previously operated uncapped resale marketplaces in the UK, but abandoned those platforms in favor of a capped system within the last five years, leaving StubHub and Viagogo alone in terms of major uncapped resale marketplaces competing for consumers in Great Britain.