Jay-Z’s Tidal-Linked Firm Takes Millions in PPP Loans
UPDATE: Malibu Entertainment, a company connected to Jay-Z’s Tide a streaming service, was among companies soliciting and accepting paycheck protection program loans in the range of $ 2 million to $ 5 million, according to documents released by the Small Business Administration and the Treasury Department; a source close to the situation tells Variety the loan was $ 2.1 million. The loans are part of the federal government’s $ 2 trillion CARES act to help small businesses affected by the coronavirus.
The loan was approved on April 7, shortly after Tidal and Roc Nation, Jay-Z’s entertainment joint venture with Live Nation that shares addresses and apparently other functions with the streaming service, dismissed, put on leave or reduced wages by 10 to 20% in half of the company, as reported by Variety. A source tells Variety that 15 Tidal employees on leave were laid off last week.
Contacted by Variety, a representative for Tidal did not comment.
Although Malibu is technically a separate business – a New York-based black-owned film and video production company with 95 supported jobs, according to the SBA document – it is part of Tidal’s infrastructure. It shares the two most recent addresses with the two companies; a 2017 lawsuit alleged that Roc Nation, Tidal, Malibu Entertainment and Aspiro, Tidal’s parent company, were essentially the same company (although the lawsuit was dismissed without a clear ruling on the matter); in 2017, Malibu applied for H1B visas for graphic designers serving as the contact point for Joseph Borrino, Roc Nation’s CFO at the time, who was using a Tidal.com email address; and several Tidal employees tell Variety that their paychecks are from Malibu Entertainment.
Jay-Z is not the only billionaire whose company has taken out a PPP loan. Yeezy, the clothing company owned by fellow billionaire Kanye West, has also taken out a loan of $ 2-5 million, the documents say, and there are plenty more outside of the music world. The biggest touring groups, the Eagles, Pearl Jam and Disturbed, have taken out loans between $ 350,000 and $ 1 million; for tours, financial support is intended for crews and other support staff for current and future tours. The Messina Touring Group, which has toured by Taylor Swift, Ed Sheeran, Kenny Chesney and George Strait, was also among the recipients, as were many independent labels and touring artists who took on smaller loans.
A source said Variety that Tidal and Roc Nation carried out the March layoffs and holidays swiftly as the crushing impact of the coronavirus brought two of Roc’s main financial pillars – music tours and sports – to virtual standstill. Founded in 2008, Roc Nation is a multi-faceted management-label-publishing company established in partnership between Jay-Z and Living country, while Aspiro is the Norwegian parent company of Tidal which Jay bought in 2015, when the streaming service was called WiMP.
Additional reporting by Gene Maddaus.
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