JAY-Z TEAMING WITH LYOR?

The NY Daily News reports that Jay-Z could be returning to the corporate ranks.

The rag mag reports that Jay has been huddling with LA Reid's (Def Jam CEO) rival, Warner Music Group head Lyor Cohen, to talk about starting his own label - tentatively called the Carter Music Group.

"The reason Jay left Def Jam was less about money than about freedom," an insider told NY Daily. "He didn't want to come to the office every day. And he had so many outside projects - his chain of 4-0/40 clubs and the hotel he's building in Chelsea. But he wouldn't mind having a small label for the talent he discovers. He might just put out three or four records a year. He'd let somebody else do the heavy lifting."

Cohen however maintains that he and Jay have not discussed a label deal yet.

"I would be honored and privileged to work with him again," says Cohen, who signed Jay to Island/Def Jam when Cohen was there. "Bringing Jay-Z to the Warner Music Group would be a privilege and a coup. I'd do it in a heartbeat."

Cohen disputed the suggestion of Jay-Z running a "small" label. "Jay never does anything small or part-time," said Cohen.

Jay still owes Def Jam a new album - due later this year - and a greatest hits CD. One exec there doubted Reid would be bothered by his artist competing with him. "Starting a record label from scratch is very difficult," says the source. "If Warner Music wants to do it, better them than us."