APPLE announced yesterday that it is snapping up Beats Electronics, an audio firm famed for its headphones, for $3bn (£1.8bn).
Beats founders Jimmy Iovine and Dr Dre will join Apple as the technology and computer giant takes over their firm, which is known for its iconic headphones. The deal will worth $2.6bn immediately with another $400m that Apple says will vest over time.
The deal is expected to be closed at some point during the summer, subject to the go-ahead from regulators. Speculation about the acquisition had been rife over the last month.
“I’ve always known in my heart that Beats belonged with Apple,” said Iovine, who helped to found the company in 2008.
“Apple’s deep commitment to music fans, artists, songwriters and the music industry is something special,” he added.
Last year, asset management firm the Carlyle Group announced that it had taken a minority stake in Beats, while Beats bought back a share previously owned by Taiwanese technology firm HTC.
Apple’s share price dropped by 0.26 per cent during the day, but stabilised after trading hours once the deal was announced.