#TheWeeklyRoundUp 05.03.21

Square to buy Jay Z’s Tidal for $297M (MBW)

Jack Dorsey-led financial services company Square, Inc. has entered into a definitive agreement to acquire a majority ownership stake in music streaming platform, TIDAL.

Square expects to pay a mix of cash and stock of $297 million for a ‘significant majority’ ownership stake. Existing artist shareholders will be the remaining stakeholders.

TIDAL will operate independently within Square, alongside the Seller and Cash App ecosystems.

According to the companies, the acquisition “extends Square’s purpose of economic empowerment to a new vertical: musicians”.

The media release added: “Artists are entrepreneurs with a dream and deserve access to systems, tools, and financial freedom to reach those dreams at every stage in their career”.

TIDAL board member and shareholder Shawn “Jay-Z” Carter is expected to join Square’s Board of Directors subject to the closing of the transaction.

In addition to Jay-Z, all of TIDAL’s artist shareholders will continue to be co-owners of TIDAL after the deal closes.

Square executive Jesse Dorogusker will serve as interim lead of TIDAL after the deal closes.

The completion of the transaction will be subject to standard regulatory approvals and is expected to close in Q2 2021.

Square was primarily advised by Gibson, Dunn & Crutcher LLP as legal advisors and TIDAL was advised by Reed Smith LLP and Cummings & Lockwood LLC as legal advisors.

“I KNEW TIDAL WAS SOMETHING SPECIAL AS SOON AS I EXPERIENCED IT, AND IT WILL CONTINUE TO BE THE BEST HOME FOR MUSIC, MUSICIANS, AND CULTURE.”JACK DORSEY, SQUARE

“It comes down to one simple idea: finding new ways for artists to support their work,” said Jack Dorsey, co-founder and CEO of Square.

“New ideas are found at intersections, and we believe there’s a compelling one between music and the economy.

“I knew TIDAL was something special as soon as I experienced it, and it will continue to be the best home for music, musicians, and culture.”

“THIS PARTNERSHIP WILL BE A GAME-CHANGER FOR MANY. I LOOK FORWARD TO ALL THIS NEW CHAPTER HAS TO OFFER.”JAY-Z

Shawn ‘JAY-Z’ Carter added: “I said from the beginning that TIDAL was about more than just streaming music, and six years later, it has remained a platform that supports artists at every point in their careers.

“Artists deserve better tools to assist them in their creative journey. Jack and I have had many discussions about TIDAL’s endless possibilities that have made me even more inspired about its future.

“This shared vision makes me even more excited to join the Square board. This partnership will be a game-changer for many. I look forward to all this new chapter has to offer!”

“TOGETHER, TIDAL AND SQUARE WILL BE MUSIC-OBSESSED AND ARTIST-FOCUSED WHILE WE EXPLORE NEW ARTIST TOOLS, LISTENER EXPERIENCES, AND ACCESS TO FINANCIAL SYSTEMS THAT HELP ARTISTS BE SUCCESSFUL.”JESSE DOROGUSKER, SQUARE

Jesse Dorogusker added: “TIDAL sets a high standard for supporting artists, capturing music culture, and delivering the best audio quality to fans.

“Square has also set a high standard for building elegant, accessible, and fair tools for sellers and individuals to economically empower them.

“Together, TIDAL and Square will be music-obsessed and artist-focused while we explore new artist tools, listener experiences, and access to financial systems that help artists be successful.”

TIDAL was launched in 2010 across Scandinavia under its original name of WimP, offering both a standard and hi-def audio package.

The platform’s former parent company Aspiro changed WimP’s name to TIDAL in March 2015 ahead of its acquisition by Project Panther Bidco, led by Jay Z.

In addition to Jay Z, the company announced that its owners included 16 of the biggest artists in the world, introduced at a press conference in New York at the end of March.