What just happened? Square has entered into an agreement to purchase a majority stake in subscription-based streaming service Tidal. The deal is expected to close in the second quarter of 2021, pending customary closing conditions and regulatory approval. Once that happens, Tidal will operate independently within Square alongside the Cash App and Seller ecosystems.
Per the terms of the deal, Square will pay $297 million in cash and stock in exchange for a “significant” majority ownership stake. Existing artist shareholders will maintain their holdings and be the remaining stakeholders.
Square is perhaps best known as the mobile payment provider founded by Jack Dorsey in 2009. Most recently, the company has made headlines for its investments in Bitcoin.
Back in October, Dorsey spent $50 million of Square’s assets to buy 4,709 Bitcoins. Based on the current value of Bitcoin, that investment is now worth more than $237 million. And late last month, Square announced it had purchased another 3,318 Bitcoins for $170 million.
Also worth noting is the fact that Tidal board member and shareholder Shawn “Jay-Z” Carter will join Square’s board as part of the deal. The rapper got involved in the streaming music industry back in 2015 when he purchased tech company Aspiro for $56 million.
Images courtesy Daniel Constante, Debby Wong