Federal regulators gave the OK for Live Nation to merge with Ticketmaster — with compromises to create more competition in the ticket retail market.
Lawmakers and artists were worried that the deal, which unites the nation’s largest concert promoter and largest ticketing service, would mean higher ticket prices for consumers. Those fears were compounded by the fact that Live Nation had planned to enter the ticket market and become a direct competitor to Ticketmaster prior to their merger agreement.
To do the deal, the Department of Justice required Ticketmaster to license its ticketing software to rival concert promoter Anschutz Entertainment Group and to sell Paciolan, the ticketing subsidiary it bought just two years ago. Comcast has already signed a letter of intent to buy Paciolan.
The concessions will create a new ticketing competitor in AEG — which ranked as Ticketmaster’s largest client, selling about 10 million tickets through the company last year — and strengthen Comcast’s position in ticket sales.
The compromise “promotes robust competition for primary ticketing services and preserves incentives for competitors to innovate and discount, which will benefit consumers,” said antitrust top cop Christine Varney in a statement.
Additionally, the Justice Department said that it would be watching the merged company, Live Nation Entertainment, closely to make sure that it doesn’t retaliate against any venue owner that uses AEG, Comcast or another firm’s ticketing services instead of its own.
The company is not allowed to bundle tickets with promotion and artist services, or use consumer data gleaned from other venue owners for its own promotions.
Live Nation will not need to sell any of its venues, however, and Ticketmaster will not have to give up its artist management company Frontline, as many had expected.
Investors worried that the deal might not pass regulatory muster, given that the pact was under review for a year. Justice’s Varney has been talking tough recently about more closely scrutinizing mergers. Investors registered their relief by sending shares of both companies skyrocketing yesterday.
Live Nation shares closed up 15 percent, or $1.35, to $10.51. Ticketmaster shares leapt 16 percent, or $2.10, to end the day at $15.40.
According to Jim Rill, who headed up the Justice Department’s antitrust division under President Clinton, the ruling is “consistent with the a strong and rationale enforcement policy.”
“It shows that the DoJ did a substantial job and got a significant settlement,” Rill said. “They are creating one, and possibly two, new competitors in the market while at the same time letting the merger’s synergies be realized.”
Now that the merger is official, Live Nation boss Michael Rapino will take over day-to-day operations as the combined company’s CEO. Irving Azoff will hold the title of executive chairman, but will focus mainly on running Frontline. peter.lauria@nypost.com