The proposed merger of Live Nation and Ticketmaster isn’t going to race through regulatory approval. The companies say they’ve gotten a second request for information from the DOJ antitrust watchdogs. The would-be merger partners say the request was expected and they still expect to win approval and merger before the end of this year.
The formal “Request for Additional Information” is pretty standard for any merger with even a hint of antitrust ramifications under the Hart-Scott-Rodino Antitrust Improvements Act. And there’s more than a hint in this case. Quite a few Members of Congress are up in arms over the proposed combination and Bruce Springsteen attacked the proposal even before it was officially announced.
At a recent Senate hearing, Sen. Chuck Schumer (D-NY) made it clear that he agreed with “The Boss.” (We presume he was referring to Springsteen, rather than President Barack Obama.) Schumer said it was “monopolistic behavior, plain and simple.” Schumer joined Sen. Orrin Hatch (R-UT) in a tough grilling of Ticketmaster CEO Irving Azoff and Live Nation CEO Michael Rapino.
Azoff insisted that his company is not responsible for high ticket prices – that artists set the prices.
Live Nation had rolled out its own ticket-selling operation shortly before the merger was announced. “If Live Nation can’t compete, after all, who can?” worried Sen. Herb Kohl (D-WI).
Live Nation, the nation’s largest concert promoter and live venue operator, proposed in February to merge with Ticketmaster, the nation’s largest ticket seller and owner of Front Line Management Group, the artist management company. The combined venture is being valued at $2.5 billion.
RBR/TVBR observation: It will be interesting how much more of an activist approach the DOJ will take under President Obama and Attorney General Eric Holder, unlike the lazy lapdogs who waved through the monopolization of the satellite radio business. As we noted previously, both Live Nation and Ticketmaster have lots of enemies in the entertainment business and on Capitol Hill, so there’s almost no political downside to rejecting this merger.