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AEG bid to run Wembley Arena sent to the Competition Commission AEG bid to run Wembley Arena sent to the Competition Commission
(6 months later)
Live music giant AEG's bid to take over the running of Wembley Arena has been referred to the Competition Commission over fears that its growing dominance of venues in London could lead to higher ticket prices.Live music giant AEG's bid to take over the running of Wembley Arena has been referred to the Competition Commission over fears that its growing dominance of venues in London could lead to higher ticket prices.
The US giant – which owns assets including The London O2 Arena and Hammersmith Apollo and has the contract for concerts in Hyde Park – acquired the contract to manage Wembley Arena late last year.The US giant – which owns assets including The London O2 Arena and Hammersmith Apollo and has the contract for concerts in Hyde Park – acquired the contract to manage Wembley Arena late last year.
The contract had been held by arch-rival Live Nation, which recently struck a deal to host gigs at the Olympic Stadium in east London after AEG snapped up the contract it previously held for Hyde Park gigs.The contract had been held by arch-rival Live Nation, which recently struck a deal to host gigs at the Olympic Stadium in east London after AEG snapped up the contract it previously held for Hyde Park gigs.
The Office of Fair Trading has been investigating AEG's takeover of the Wembley Arena, which has hosted performers including Madonna, Cold Play and Elton John, since the new year.The Office of Fair Trading has been investigating AEG's takeover of the Wembley Arena, which has hosted performers including Madonna, Cold Play and Elton John, since the new year.
On Friday the OFT said it has referred the acquisition of the management contract to the Competition Commission "due to concerns the merger may substantially reduce competition in the live entertainment venue sector".On Friday the OFT said it has referred the acquisition of the management contract to the Competition Commission "due to concerns the merger may substantially reduce competition in the live entertainment venue sector".
The OFT pointed out that following the deal AEG now operates the two largest London indoor venues: The O2 Arena and Wembley Arena.The OFT pointed out that following the deal AEG now operates the two largest London indoor venues: The O2 Arena and Wembley Arena.
"This merger would result in a major consolidation of the indoor spaces where large concerts, sports and other shows can be held in the capital and may result in higher costs for promoters to hire suitable venues, which ultimately may be passed on to consumers in the form of higher ticket prices.," said Jackie Holland, senior director at the OFT. "As such, we believe it is appropriate that the Competition Commission reviews this merger in detail to ensure that the interests of consumers are protected"."This merger would result in a major consolidation of the indoor spaces where large concerts, sports and other shows can be held in the capital and may result in higher costs for promoters to hire suitable venues, which ultimately may be passed on to consumers in the form of higher ticket prices.," said Jackie Holland, senior director at the OFT. "As such, we believe it is appropriate that the Competition Commission reviews this merger in detail to ensure that the interests of consumers are protected".
The Competition Commission is expected to report by 5 September, 2013.The Competition Commission is expected to report by 5 September, 2013.
The global multibillion-pound live music market is dominated by US groups Live Nation, which in the last year handled tours by Bruce Springsteen, Coldplay and Rihanna, and AEG.The global multibillion-pound live music market is dominated by US groups Live Nation, which in the last year handled tours by Bruce Springsteen, Coldplay and Rihanna, and AEG.
AEG controls a glittering array of assets including London's O2 Arena, the Colosseum at Caesar's Palace in Las Vegas, and festivals including Coachella in California, owns David Beckham's former club LA Galaxy, and is an investor in the LA Lakers basketball team.AEG controls a glittering array of assets including London's O2 Arena, the Colosseum at Caesar's Palace in Las Vegas, and festivals including Coachella in California, owns David Beckham's former club LA Galaxy, and is an investor in the LA Lakers basketball team.
The 02 Arena owner was put up for sale late last year by billionaire Philip Anschutz with a $10bn (£6.4bn) price tag, but has since been taken off the auction block.The 02 Arena owner was put up for sale late last year by billionaire Philip Anschutz with a $10bn (£6.4bn) price tag, but has since been taken off the auction block.
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