Jay Z
has set his sights on buying Aspiro, the Swedish parent company of two
subscription streaming services, WiMP and TIDAL. The offer of 464
million Swedish krona, or $56.2 million, represents a 59.1 percent
premium over yesterday's closing share price. It was announced by Aspiro
early this morning and has already been accepted. Trading of Aspiro stock was up 76 percent on the news this morning, to 0.08 per share.
The proposed acquisition is being made via the mogul's
Project Panther Bidco, a subsidiary of his S. Carter Enterprises, and is
still subject to shareholder approval. A spokesperson said Panther's
"strategic ambition" for Aspiro is to expand and up-scale its technology
and services. The full statement from the rep is below:
Project Panther Bidco, Ltd
("Panther"), an entity controlled by S. Carter Enterprises, LLC ("SCE")
is pursuing a possible acquisition of Aspiro AB ("Aspiro"), based in
Sweden. Aspiro is a media technology company in the forefront of the
ongoing redefinition of music consumption. Through the subscription
services WiMP and TIDAL, Aspiro offers a complete experience of higher
HiFi quality. The platform encompasses audio, video and integrated
editorial features.
Panther believes that the recent
developments in the entertainment industry, with the migration to media
streaming, offers great potential for increased entertainment
consumption and an opportunity for artists to further promote their
music. Panther's strategic ambition revolves around global expansion and
up-scaling of Aspiro's platform, technology and services.
The acquisition is subject to shareholder approval. As such there is no guaranty that a transaction will take place.
On its website, WiMP offers editorial recommendations
through "local editorial teams in each country," which may signal a plan
to integrate Jay Z's culture site Life and Times into
its platform. The company also operates a video syndication platform
RADR Music, which provides music videos and live performance footage to
"online media enterprises." (As opposed to YouTube.)
WiMP was launched in 2011, ostensibly as a competitor to
Spotify, though the company hasn't been able to keep pace with Daniel
Ek's now-ubiquitous service. Aspiro's last financial filing lists it as having 512,000 paying subscribers, compared to Spotify's 15 million paying subscribers. Not to mention the soon-to-be-relaunched Beats, which Apple purchased for $3 billion last year.
TIDAL, a premium service geared towards audiophiles, calls
itself the "first music streaming service that combines the best High
Fidelity sound quality, High Definition music videos and expertly
Curated Editorial."
Streaming continues to displace purchased music downloads,
with track and album download sales dropping 12.5 percent and 9.4
percent, respectively, in 2014. Compare that to streaming, where SEA
(streaming equivalent albums, or 1,500 streams of a record) were up by 56 million last year.
Despite the fact that no on-demand streaming company has
yet to turn a profit -- it's clear which way the wind is blowing, and
Jay Z now has a kite to play with.
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