(vip-booking) – US ticket exchange and resale company StubHub has postponed its initial public offering (IPO) until at least September due to a “choppy market,” according to the Wall Street Journal.
Originally planning for a summer IPO with a valuation target of about $16.5 billion, StubHub had filed paperwork with the Securities and Exchange Commission that was supposed to be made public by the end of the week. However, a source close to the deal described it as a “tricky time” for IPOs, noting the absence of any recent “large, successful offerings.”
The source also indicated that StubHub faced a deadline as its audited financial statements would go “stale” this month. To list its stock without needing to update its audited financials, the company would have to make its filing public by the end of the week.
Bloomberg reported that StubHub will need to resubmit its financial information to the SEC.
Coincidentally, the delay comes just days after the attorney general for Washington, D.C., filed a lawsuit against StubHub. The lawsuit alleges that the platform deceives consumers with low initial prices that increase with additional fees, a practice known as “drip pricing,” which violates consumer protection laws in the U.S. capital.
“StubHub intentionally hides the true price to boost profits at its customers’ expense,” said D.C. Attorney General Brian Schwalb in a statement.
In response, the New York-based company expressed disappointment and maintained that its “user experience is consistent with the law” and comparable to competitors’ practices. StubHub also voiced support for federal and state measures requiring uniform all-in pricing across platforms.
The lawsuit claims that StubHub adds undisclosed fees at the end of the purchasing process, obscuring the actual ticket cost. It further alleges that these hidden fees can exceed 40% of the ticket’s advertised price.
According to the lawsuit, StubHub sold nearly 5 million tickets and charged consumers $118 million in fees, prompting the attorney general to seek damages and an end to these sales practices.
