Apple announced Wednesday it will buy headphones and music streaming company Beats Electronics, co-founded by Dr. Dre, for $3 billion. Wednesday’s announcement confirmed rumors about the deal which had been circulating for weeks.
“Music is such an important part of all of our lives and holds a special place within our hearts at Apple,” said Apple CEO Tim Cook 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.”
Apple is purchasing Beats for $2.6 billion in cash plus another $400 million in equity, marking the company’s biggest-ever acquisition. The tech giant expects to complete the deal by Q4 of this year, pending regulatory approval.
Beats was founded in 2008 by the rapper and producer Dr. Dre and the producer and mogul Jimmy Iovine. The company primarily sells high-end headphones and speakers, as well as audio software and subscriptions to a music-streaming service.
Iovine and Dr. Dre will stay on at the firm working within Apple’s electronics and music-streaming divisions. Their titles will simply be “Jimmy and Dre,” Iovine told The Wall Street Journal.
“I’ve always known in my heart that Beats belonged with Apple,” said Iovine, a longtime friend of Apple co-founder Steve Jobs. “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.”