Reports has been circulating since yesterday that Apple is in negotiation to acquire Beats Electronics, which will make Beats Electronics its largest ever acquisition.
Beats Electronics – “People aren’t hearing all the music”
According to reports on Financial Times, the deal is all but sealed for now but the negotiations are on-going and if both corporations can reach an agreement, the deal could be signed as early as next week. These reports have been backed up by major new outlets including Bloomberg, Wall Street Journal and NY Times.
Beats Electronics is the company behind the Beats by Dre headphones and other audio products is founded by Interscope duo, Ace Rapper Dr. Dre and Music Producer Jimmy Lovine. The company is currently valued at $1 Billion inclusive of the $500 million investment by the carlyle group which means Apple is ready to over pay for the Santa Monica based outfit.
The deal with Beats Electronics would include Apple acquiring the Hardware and the recently launched music streaming service Beats Music; if the deal goes through the Beats Electronics Management team would report directly to Apple CEO, Tim Cook.
As at press time, both Apple and Beats Electronics team refused to comment on the matter. Back in 2011, HTC acquired 50.1% controlling interest in Beats Audio for $300 but the partnership did not go as planned; as such HTC purchased the HTC owned shares September 2013. The Cupertino phone maker is known for acquiring non-high profile acquisitions under Steve Jobs, with reports showing that Apple acquired 24 companies over the past 18 months looks like Apple CEO, Tim Cook is ready to splash the cash.
Beats products are currently sold in Apple stores so its more likely Apple is looking to release a breakthrough products since 2011. According to the Recording Industry Association of America, Streaming music revenue from the likes of Pandora and Spotify increased by 39% to $1.4 billion, while Downloads which iTunes dominates dropped by 1% to $2.8 billion in revenue.
This recent reports of Apple acquiring Beats Electronics for $3.2 billion will follow Google’s acquisition of smart home developer Nest Labs and Facebook’s acquisition of Whatsapp for $19 billion and Occulus VR for $2 billion.
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