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Apple set to buy Beats Electronics for $3.2bn

Reports that US company is to takeover the headphone maker and music streaming distributor founded by the rapper Dr Dre.

Last updated: 10 May 2014 11:27
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The US technology company Apple is reported to be on the verge of a $3.2bn acquisition of Beats Electronics, the headphone maker and music streaming distributor founded by the rapper Dr Dre.

People familiar with the negotiations told the UK's Financial Times newspaper that the agreement could be announced as early as next week, a report posted online late on Thursday said.

If the deal is completed, it would be the largest purchase in Apple 38-year history. Both companies declined to comment to the AP news agency.

Apple's pursuit of Beats is the latest indication that the company is having trouble generating growth on its own.

It already sells Beats gear in its stores, giving the company insights into how much the trendy headphones and other audio equipment appeal to its customers.

Apple has not released a breakthrough product since Steve Jobs, its former chief executive, died in October 2011.

The innovative void has increased the pressure on Tim Cook, Jobs' hand-picked successor, to prove he is capable of sustaining the success and growth that turned Apple into the world's most valuable company.

Cook has shown a willingness to spend more of Apple's money than Jobs.

Among other things, he began paying Apple stockholders a quarterly dividend and has progressively committed more money to buying back the company's shares.

Beats success

Beats Electronics was founded in Santa Monica, California in 2008 by Dr Dre and Jimmy Iovine. Its headphones were manufactured by Monster Cable until the two companies parted ways in 2012.

In 2012, Beats bought streaming music service MOG, which it transformed and relaunched as Beats Music earlier this year.

The launch was fueled by a landmark partnership with AT&T that allowed up to five family members to pay $15 a month for the service as long as they were AT&T wireless customers.

The deal broke the industry mould of charging each person $10 per month.

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Source:
Al Jazeera and agencies
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