Some acquisitions are made quietly so as to not attract attention. Apple Inc. (NASDAQ:AAPL) is reportedly set to acquire Beats Electronics for a whopping $3.2 billion, whereby Apple Inc. (NASDAQ:AAPL) will also acquire all Beats properties. Beats Electronics is a premium headphone maker and also a music streaming service. Beats headphones are already available in many Apple stores, which is why the acquisition makes sense.
The acquisition is close to being finalized: FT
According to reports from the Financial Times the deal is close to being finalized. The deal could be announced as early as next week, FT sources report. However, there are still some details to be worked out and nothing is set in stone at this stage.
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With this deal, Apple Inc. (NASDAQ:AAPL) will acquire Beats audio equipment business, which includes its brand of headphones and audio equipment, and Beats’ streaming music service, which was launched earlier this year. With Beats Music, the company is taking on the likes of All Access and Spotify, which are its biggest competitors. Beats, however, was struggling with low subscriber numbers. Apple Inc. (NASDAQ:AAPL) will likely try something new to make the music service more popular.
It’s possible that Apple Inc. (NASDAQ:AAPL) is doing this deal especially for the Beats Music service, which would give Apple immediate access to streaming audio. Apple’s iTunes Radio is not that popular, plus it doesn’t offer access to a particularly large music library. If Apple purchases Beats and then combines both of them to create something like “All Access”, then it could be a game changer.
While this deal might sound good, based on the rumored price, Apple Inc. (NASDAQ:AAPL) is paying a high premium to acquire the company. Beats is currently valued at $1 billion, but apparently Apple Inc. (NASDAQ:AAPL) is willing to pay $3.2 dillion to acquire it. Until we hear official confirmation, we should take this news with a pinch of salt.