Jay Z’s $US56 bid for Aspiro may be rejected

Jay Z’s $US56 million public offer for Scandinavian company Aspiro, which operates high-def streaming platform WimP/Tidal, may be rejected.

The company's minority shareholders, a group of 120 people who own 10% of Aspiro, reportedly blocked the bid following advice handed down by equity association Aktiespararna.

According to Swedish newspaper Dagens Industri, Aktiespararna allegedly advised Aspiro to block the bid from Jay Z’s holding company Project Panther Bidco due to concerns about the value it would bring to investors.

"A consistent view of all registered shareholders is that they believe that the bid is bad and not sufficiently value the company's potential," the shareholders’ statement read.

 However, Fredrik Bjørland, Chairman of the Aspiro’s independent board committee, has backed Jay Z’s Project Panther bid in a statement posted by The Next Web.

“We still believe the offer is attractive for both the company and its shareholders, and recommend the offer based on this.

“We further note that Aktiespararna’s recommendation to not accept the offer is primarily based on an argument that more than 10% will reject the offer and a potentially raised bid by Project Panther. This is a bit surprising, as to my experience, we have neither a confirmation that more than 10% will reject the offer (as we are still within the acceptance period until March 11th) nor that Project Panther is willing to raise its bid or engage in direct negotiations with the minority shareholders.

“In my opinion, the recommendation to not accept the offer involves high risk, as it is well known that Aspiro is currently unprofitable and in need of capital within 12 months, and the current majority shareholder has indicated it is not willing to support this capital need. We thus believe accepting a 60% bid premium is a far better risk/reward recommendation.”

Aspiro's Tidal service, which operates in the US, Canada and the UK, and its WiMP music service in Norway, Sweden and other parts of Europe, are currently in dire need of a fund injection. Aspiro's third quarter financials filing for 2014 states it has 512,000 paying subscribers – Spotify reached 15 million paying subscribers last month. It also posted a net loss of 84.1m SEK (AU$12.9m) for the last calendar year.