Apple® today announced it has agreed to acquire the critically acclaimed subscription streaming music service Beats Music, and Beats Electronics, which makes the popular Beats headphones, speakers and audio software. As part of the acquisition, Beats co-founders Jimmy Iovine and Dr. Dre will join Apple. Apple is acquiring the two companies for a total of $3 billion, consisting of a purchase price of approximately $2.6 billion and approximately $400 million that will vest over time.
“Music is such an important part of all of our lives and holds a special place within our hearts at Apple,” said Tim Cook, Apple’s CEO. “That’s why we have kept investing in music and are bringing together these extraordinary teams so we can continue to create the most innovative music products and services in the world.”
“I’ve always known in my heart that Beats belonged with Apple,” said Jimmy Iovine. “The idea when we started the company was inspired by Apple’s unmatched ability to marry culture and technology. Apple’s deep commitment to music fans, artists, songwriters and the music industry is something special.”
The deal is the largest acquisition ever made by Apple including its $400 million deal in 1996 to purchase the company NeXT which brought Steve Jobs back to the company (adjusted for inflation, that deal would measure around $600 million in 2014).
“I’ve always known in my heart that Beats belonged with Apple,” said Iovine.
Beats Electronics is the maker of a wide range of audio equipment including headphones, earphones, speakers, and car audio systems, although the company is most commonly recognized for it’s brand of high-end consumer headphones and speakers.The company has previously had relationships with Monster and HTC, and its headphones and portable speaker line has maintained a large presence at Apple Retail Store locations throughout its success. The business is said to bring in $1B a year.
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