Acquisition thought to be Apple’s biggest; deal to be completed early next year
Apple has agreed to buy headphone maker Beats Electronics and subscription streaming music service Beats Music for a combined $3 billion.
The deal, which is thought to be Apple’s biggest acquisition to date, is expected to close in fiscal Q4, subject to regulatory approvals. It also sees music producer Jimmy Iovine and hip hop artist Dr Dre, who founded the company in 2008, join Apple.
Beats is best known for manufacturing its premium headphone line and earlier this year started a subscription-based music streaming service.
In 2011, handset manufacturer HTC bought a 50 per cent stake in Beats for $309 million. A year later it sold half of that stake back to Beats for $150 and unloaded the other half back to the company last year for $265 million.
Apple CEO Tim Cook (pictured) said “music holds a special place within our hearts at Apple” and that the acquisition would continue to see it “create the most innovative music products and services in the world”.
Apple said that in the five years since its launch, the Beats “b” has become the “brand of choice” in the music and sports worlds, and is the market leader in the premium headphone market.
Music artists such as Lady Gaga, Lil Wayne and Nicki Minaj have designed their own customised Beats headphones and speakers. Fashion designer and street artists such as Alexander Wang, Futura and Snarkitecture have worked on special limited edition products, while sports stars including LeBron James, Serena Williams and Neymar use Beats.