Can Viagogo’s CEO Still Pull Off a StubHub Deal? ‘He’s Going to Take a Massive Hit’

The stumbling block for Baker and Viagogo is an ongoing investigation by the CMA, a U.K. government department, over whether the sale — which Viagogo announced it closed in February — would substantially lessen competition in the United Kingdom, leading to higher fees for ticket buyers. A provisional CMA investigation, published Oct. 23, found this to be true, with the two firms collectively covering over 90% (split roughly 60% and 30% between Viagogo and StubHub, respectively) of the U.K. secondary ticketing market. To address those concerns, Viagogo would need to sell all or part of StubHub worldwide, said the CMA, or else all or part of Viagogo.

Viagogo responded with a proposal to offload StubHub’s U.K. and European primary and secondary ticketing business, as well as a subsidiary that operates in Latin American countries, while keeping its profitable North American operations. There are, however, caveats for any potential buyer. Most notably, the new owner of StubHub would only be able to use the StubHub brand in the United Kingdom for three years, after which it would revert back to Viagogo.

Micha Theiner/Shutterstock

Eric Baker

U.K. concert ticket experts say Viagogo’s offer falls short of what’s needed. “We do not believe that a partial divestiture in any form would improve the situation,” says Sam Shemtob, director at the Face-value European Alliance for Ticketing.

“Virtually all of StubHub’s value is in North America,” says Reg Walker of Iridium Consultancy, a leading expert on the U.K. ticket retail market that opposes the merger. “There is no value in what they are offering to sell.”

Fluhr agrees. He co-founded StubHub with Baker when both men were studying at Stanford University, and then sold the company to eBay for $310 million in 2007 — three years after he urged the board to push Baker out.

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