Two live entertainment giants that spent nearly two years maneuvering for advantage are now entwined in an ardent embrace.

It surprised no one when the proposed merger of Live Nation and Ticketmaster Entertainment triggered an antitrust probe by the U.S. Department of Justice. It could also draw the interest of European regulators (see stories, page 8).

Ticketmaster CEO Irving Azoff and Live Nation president/CEO Michael Rapino both say that their companies aren't trying to join forces to eliminate competition, and they can point to viable competitors in concert promotion and venue operations. Live Nation can say that it built and launched a global ticketing system in a year, and sources say that Anshutz Entertainment Group and its live entertainment promotion division AEG Live are already well into building their own ticketing system. (AEG executives decline to comment on the matter.)

Still, the potential merger is a legal minefield. Even if it does go through, regulators could require the companies to jettison assets.

A new company created by such a merger might also have to renegotiate...

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