Apple in Talks to Acquire Beats Electronics for $3.2 Billion

Apple is said to be close to completing an acquisition of Beats Electronics, the headphone company and streaming music service created by Dr. Dre and Jimmy Iovine. According to the Financial Times , the deal could be announced as soon as next week if negotiations work out.



Apple will acquire Beats' streaming music service, which launched this year, and its audio equipment business, which includes its brand of headphones and audio equipment. The Beats management team will report to Mr Cook, said people familiar with the deal. Apple and Beats declined to comment.



Apple is said to be paying $3.2 billion dollars for the service, a sum that dwarfs the $404 million that the company spent to acquire NeXT in 1996, it's largest purchase to date. Tim Cook said earlier this year that the company was open to making large acquisitions if the purchases made sense. "We have no problem spending 10 figures for the right company, for the right fit that's in the best interest of Apple in the long-term. None. Zero."



In addition to producing a range of popular premium headphones that Apple currently sells in its stores, Beats also recently launched its Beats Music service, a direct competitor to Spotify, Pandora, and Apple's own iTunes Radio service. Beats Music is, however, a subscription-based on-demand service similar to Spotify, which could bolster Apple's free iTunes Radio.



According to the Financial Times, the deal is still in the works with some details yet to be ironed out, suggesting "talks could still fall apart."

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