UK Regulator Orders Viagogo To Pause On StubHub Merger

The Competition and Markets Authority (CMA) kicked off an investigation into the proposed sale of StubHub to viagogo, owned by Pugnacious Endeavors. They opened for questions regarding the proposed sale in December and have now issued an enforcement order to pause the merger until such time as they give the go ahead.

The CMA have ordered both eBay/StubHub and PUG/viagogo to report fortnightly under threat of fines, prison, and a 5% of turnover penalty to confirm the businesses are kept separate and going concerns in the interim. Not only are they banned from any integration or sharing trade secrets, but they must report on any changes of key personnel and any major contracts won or lost. Additionally, no assets of either business is to change hands (either between the two companies or disposal to third parties) and the businesses must stick to their pre-merger business plans as if there was never going to be a sale of StubHub to viagogo.

It’s a pretty routine warning to not do anything to combine the two businesses unless and until the CMA gives permission for the merger to go ahead. If the CMA determines that there will be a substantial lessening of competition within any market or markets in the United Kingdom from the sale of StubHub to viagogo, then they could block the merger. This would naturally put a serious dent in eBay’s plans to appease activist shareholders who want to see assets sold and a heft chunk of cash roll into their pockets. However, StubHub and viagogo are saying the CMA investigation is a routine expected step in the acquisition process and there’s nothing to worry about:

“The requirement to hold separate the two businesses of Viagogo and StubHub is an expected part of the merger process, and we fully acknowledge the importance of the CMA’s examination into the deal.”

– Viagogo 

“As the CMA states in the order itself, we do not expect any impact to the planned close of the Stubhub and Viagogo transaction. We are on track as previously communicated to complete the sale by the end of the first quarter of 2020.”

– StubHub

Full Content: Gov UK, Tamebay

Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.