A little over a year ago, Jay Z made a big business move by spending $56 million on buying then struggling music streaming service TIDAL. Hov acquired the company from it’s previous owner, the Norwegian media company Schibsted ASA via his S. Carter Enterprises LLC. In the time under new ownership, the company has had it’s fair share of ups and downs, trailing behind Spotify and Apple Music in the streaming wars. With that said, TIDAL recently announced that they surpassed 3 million subscribers, thanks in part Kanye West releasing his The Life of Pablo album exclusively on the platform.
Today, Bloomberg is reporting that Jay Z has served Schibsted ASA, the previous owners, legal papers alleging that they inflated the numbers of subscribers prior to him making the acquisition.
It became clear after taking control of Tidal and conducting our own audit that the total number of subscribers was actually well below the 540,000 reported to us by the prior owners. As a result, we have now served legal notice to parties involved in the sale.
In response, Schibsted ASA claims that Jay Z and his associates did their due diligence and knew exactly what the number of subscribers was.
Schibsted spokesman Anders Rikter:
We disagree with the accusations in the letter and any potential claims. We would like to point out that the company was listed on the stock exchange with everything that entails regarding transparent financial reporting.