The bid made by Project Panther, which is indirectly owned by the rapper’s company S. Carter Enterprises, has been unanimously recommended to shareholders by Aspiro’s board of directors.
The deal will pitch Jay Z into direct competition with Beats Music, the streaming service co-founded by Dr Dre, which was bought by Apple as part of a $3bn acquisition of its parent company Beats Electronics in 2014.
That deal helped Dre top Forbes’ annual Hip Hop Cash Kings list of rap’s richest figures for 2014, with estimated pre-tax earnings of $620m, compared to Jay Z’s estimated $60m that year.
Aspiro will sit alongside Jay Z’s other business ventures, which include the Rocaware clothing range, 9IX fragrances, Roc Nation sports agency, Armand de Brignac Champagne, and a stake in NBA basketball team the Brooklyn Nets.
In Aspiro’s last public financial statements, it said that WiMP had 512,000 paying subscribers, with 20,000 paying for its more expensive HiFi version, which offers higher-quality streams for twice the monthly cost.
According to Aspiro, it began talks with Jay Z’s company in December – the same month that Project Panther was incorporated as a company in the UK. Aspiro’s board of directors’ Independent Bid Committee has published a press release welcoming the offer.
“The Independent Bid Committee is of the opinion that Panther, indirectly owned by SCE and controlled by Shawn Carter, possesses the proprietary relationships, industry knowledge, as well as economic strength and the necessary commitment in order to realise Aspiro’s strategic plan of expanding the Company’s business and brand globally.”
“Aspiro needs substantial expansion capital and a strong and dedicated owner to be able to grow and compete on the global music streaming market,” said its chief financial officer Trond Berger.
“Panther, which is controlled by S. Carter Enterprises, LLC, has adequate financial resources and a high level of competence in the music industry. Hence, I think they will be a better owner to lift Aspiro and its advanced music streaming service to a new level.”
News of the potential acquisition vaults WiMP and Tidal into what’s shaping up to be a deep-pocketed battle for dominance in the streaming music world in 2015.
Apple is expected to relaunch Beats Music under its iTunes brand in the spring; Spotify is reportedly raising $500m of new funding to fuel its growth; and Google will surely turn the throttle up on its twin Google Play All Access and YouTube Music Key services this year too.
This article was written by Stuart Dredge, for theguardian.com on Friday 30th January 2015 10.15 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010