OFT Looks At Wembley Deal

The UK’s Office Of Fair Trading has confirmed that it’s looking into the deal that saw AEG take over operations at Wembley Arena  which was previously run by U.S. rival Live Nation.

Before Christmas, an announcement said Live Nation “agreed to halt its venue-management contract for Wembley Arena,” although sources close to the venue reckon that landlord Quintain gave it 60 days notice that its contract was being terminated.

It’s subsequently been confirmed that AEG has taken over, although Quintain has acknowledged the arrangement is “subject to review by the OFT.”

Quintain owns much of the land around the arena and works with AEG on the development of the Greenwich Peninsula site neighbouring The O2 arena, the world-leading, 25,000-capacity indoor venue also run by AEG.

The OFT is understood to be reviewing whether AEG’s Wembley deal conflicts with the 2002 Enterprise Act, in the sense that it could lessen competition within the market. If the OFT feels the deal does lessen competition in the market,  its next step would be to refer the matter to the Competition Commission.

AEG now has the rights to run shows in London’s Hyde Park which LN had previously held, and also has control of the English capital’s two major arenas.

AEG just confirmed that its first show in the park will be Barclaycard British Summer Time June 28 to July 7, and that the July 5 headliner will be Bon Jovi.

At the beginning of 2007, the Competition Commission made Live Nation and Denis Desmond’s Gaiety Investments sell off Hammersmith Apollo and The Forum before allowing them to buy into Academy Music Group.

At the time, CC deputy chairman Diana Guy said the monopoly watchdog felt the deal would mean it’s “likely that ticket prices would go up” and that “the quality of venues could decline”.

Neither AEG nor Live Nation is commenting on the OFT review.