Live Nation's stock falls on report of pending Justice Department antitrust suit

By Bill Peters

Wall Street Journal says DOJ could take action as soon as next month

Shares of Ticketmaster parent Live Nation Entertainment Inc. fell after hours on Monday following a report that the Justice Department could soon file an antitrust suit accusing the concert-ticketing giant of stifling competition.

The news was reported by the Wall Street Journal. The Justice Department and Ticketmaster declined to comment on that report.

Shares of Live Nation (LYV) were down 6.7% on Tuesday. The move lower put the stock on pace for its biggest percentage drop since July 28, when it fell 7.8%.

The Journal said that the agency could take action as soon as next month. The exact allegations against the company - which has long faced complaints that it wields too much influence over live entertainment - weren't yet clear, the Journal said.

Any move from the Justice Department would follow a years-long investigation into the company's competitive practices. That investigation, the Journal reported last year, began in 2022 and accelerated after Ticketmaster's site crashed in 2022 under the weight of demand for Taylor Swift's Eras Tour.

In November, Live Nation said it believed the agency was in the "mid-stages" of its investigation. But executives said they believed "nobody thinks that the fundamentals" behind its promotions business had run afoul of the law.

The Journal, at that time, said the probe focused on whether Live Nation restricted concert venues from working with other promoters or ticket sellers when the company strikes deals with artists, among other possible restrictions.

Live Nation has benefited from a massive rebound in concert demand since the pandemic, driving up ticket prices and touring costs for musicians. The company said in February that it wanted to expand its VIP offerings as well as so-called dynamic ticket pricing, in which prices can change according to demand.

Live Nation, in its annual report, said it believes it is the world's largest live-entertainment company. But as lawmakers try to keep hidden ticket fees in check and to increase transparency, the company has tried to defend itself against accusations that it prices those tickets unfairly.

"Tickets are actually priced by artists and teams," Dan Wall, executive vice president for corporate and regulatory affairs at Live Nation, said last month. "It's their show, they get to decide what it costs to get in."

Wall Street analysts over the years have downplayed the possible impact of regulatory action against Live Nation, which merged with Ticketmaster in 2010. But the Biden administration has taken a tougher stance against corporate consolidation as two years of price increases for basics weigh on consumers.

The government sued to block JetBlue Airways Corp. (JBLU) from buying Spirit Airlines Inc. (SAVE) - a deal both airlines eventually abandoned - as well as the planned merger between grocery chains Kroger Co. (KR) and Albertsons Cos. (ACI).

Shares of Live Nation are up 36% over the past 12 months.

-Bill Peters

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

04-16-24 1135ET

Copyright (c) 2024 Dow Jones & Company, Inc.