Ticket Merger Could Face Close Inspection

Live Nation, the world's largest promoter and operator of venues is in merger talks with Ticketmaster, the world's largest ticketing and artist management group. An announcement of a deal could come as early as next week, according to a report on the Web site of the Financial Times.

Both analysts and rivals say that this deal could be an early test of the Obama administration, as the deal is expected to come under much scrutiny. Both companies involved declined comment, and management, antitrust issues, or price could still derail the talks.

Earlier talks between Ticketmaster and Anschutz Entertainment Group, a rival venue owner, collapsed.

Several people predicted strong resistance to any agreement that could face investigation from both the Department of Justice and regulatory agencies in Europe. "For consumers in the US it would definitely limit the competition. We'd strongly object to this merger," Don Vaccaro, chief executive of TicketNetwork.com, a secondary ticketing provider, said. Vaccaro also said that a combined group could force artists his company manages to favor venues it owns.

Davis Kestenbaum, an analyst at Morgan Joseph, said: "The unknown is how the new Justice Department will react to mergers, but our view is that it will be much tougher than the previous administration."

Shares in both companies rose at the prospect of the merger that would boost these companies at a period when rapid growth in the live music industry is expected to end.

Through its acquisition of Irving Azoff's Front Line Management business last October, Ticketmaster began representing acts including the Eagles and Miley Cyrus, moving into the same territory as Live Nation, which has deals with Madonna and U2.

Mr. Azoff appears to be poised to chair the merger group, with Live Nation's Michael Rapino taking the chief executive role.

The two companies could ease antitrust concerns by offering more transparency in ticket pricing, such as removing service fees, and using artists' fan networks to reduce the number of unsold tickets at concerts.