M & A Law Prof Blog

Editor: Brian JM Quinn
Boston College Law School

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Monday, January 25, 2010

Ticketmaster-Live Nation Transaction Approved

The DOJ Antitrust Division just announced it has approved the proposed Tickmaster-Live Nation deal.  This transaction was subject to a good deal of controversy -- including vocal opposition from The Boss.  And if Springsteen has an opinion on a transaction, it's got to be a big deal.  From the DOJ press release

After a rigorous investigation, we concluded that the transaction, as originally proposed, was anticompetitive. ...  

The relief here is both structural and behavioral. The settlement requires Ticketmaster to divest more ticketing than it will gain through its acquisition of Live Nation. Simultaneously, the licensing solves a second competitive issue by giving AEG, an integrated competitor, the ability and incentive to compete with the combination of Ticketmaster and Live Nation for concert promotion, venue management, and ticketing.

Under the settlement, Ticketmaster will be required to license its ticketing software to AEG, its single largest customer. AEG will now have the opportunity and incentive to compete in primary ticketing, both in its own venues and third-party venues. Under the settlement, AEG will transition from using Ticketmaster for its ticketing needs, which last year involved about ten million tickets, to its own ticketing platform. Thus, the proposed settlement opens the door for AEG to become a vertically integrated competitor with competitive incentives similar to those of the merged company.

In addition, Ticketmaster will divest Paciolan, an established ticketing business that sells tens of millions of tickets annually. Within sixty days, Ticketmaster will divest Paciolan to Comcast-Spectacor, which has already signed a letter of intent, or some other buyer suitable to the Department.

A copy of the DOJ's Competitive Impact Statement filed with the court is here and AEG and Tickmaster's technology agreement - required as part of the settlement is here.

-bjmq


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