Tech company confirms rumored deal
Apple is acquiring Dr. Dre's Beats Electronics for $3 billion, the tech company confirmed Wednesday. Apple will pay $2.6 billion in cash and another $400 million in equity and continue to use the Beats brand.
“Music is such an important part of all of our lives and holds a special place within our hearts at Apple,” CEO Tim Cook said in a statement. “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.”
The deal will include Beats Electronics, maker of Beats headphones, as well as the Beats Music streaming service.
Beats co-founders Dr. Dre and Jimmy Iovine, Interscope Geffen A&M Chairman and CEO, will join Apple in as-yet undefined roles. Iovine will step down from his role at Interscope later this year.
“I've always known in my heart that Beats belonged with Apple,” Iovine said. “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 purchase price is $200 million lower than initial estimates for the deal and is expected to close in the fourth quarter of 2014.