Apple Officially Seals The Deal With Beats Electronics

Discussion in 'Stock Market Forum' started by PaulSchinider, May 29, 2014.

  1. PaulSchinider

    PaulSchinider Well-Known Member

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    Apple’s rumored deal with Beats Electronics has been confirmed, with the former paying $2.6 billion in cash and $400 million in equity


    Apple Inc. (AAPL) has confirmed that it is acquiring headphone maker Beats Electronics for $3 billion. Earlier this month, when rumors about the acquisition first surfaced, the figure was reported to be $3.2 billion, but Apple is actually paying just a tad less: $2.6 billion in cash and $400 million in equity, which will vest over time. Beats co-founders, Jimmy Iovine and Dr. Dre, will join the tech giant, with the former leaving all other job posts to come to Apple. The deal is expected to be finalized by the end of September this year.
    This is Apple’s biggest acquisition to date, and is expected to help it in furthering its music ecosystem, which has been losing its luster amid the shift to music streaming instead of music purchasing and downloading. In a memo to employees, Tim Cook emphasized Apple's role in the music industry, reminiscing about how the company used to sell Macs to musicians, and later on began selling digital music to millions of people via its iTunes Store. Importantly, the acquisition marks the first new thing in Apple's portfolio since the iPad, and it cost just 1.73% of the $150.6 billion in cash and marketable securities that Apple is sitting on.
     
  2. JR Ewing

    JR Ewing Super Moderator Staff Member

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    One of Apple's top guys who's been with them for 25 years says that their current pipeline is the best he's seen since he's been with the company. We shall see.
     
  3. hnatalieann

    hnatalieann Guest

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    That's a nice seat! I wish I was sitting on a few billion dollars. Hopefully for them it pans out to be a good investment.
     
  4. Leeroy_MY

    Leeroy_MY Well-Known Member

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    I don't get it, Apple is obviously trying hard to constantly improve and is even willing to make huge acquisitions for change but they just kept sticking to the same old generic look for their products year after year after year. :/
     
  5. Aprax

    Aprax Active Member

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    I didn't realize people even still bought Beats. I bought a pair of them 3 years ago that still work, but I can understand a lot of the complaints regarding the quality of Beats in general. I also had bad customer support experiences with them.
     
  6. ami560

    ami560 Member

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    This could hopefully pay out in Apple shares rising. It won't help me, but I have some friends that it could. It does also mean that Apple now owns one of the most well known sound companies in the world. They now say who can license this technology, which can mean huge profits for them. As for the money, well, they can spend that much so why not?
     
  7. foodietr

    foodietr Member

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    This deal was actually on the works since the end of last year I read. Apple shares don't show much of an improvement and we cannot say for sure if this is because of the Beats acquisition or because of the WWDC which was held recently. Apple has also been known to not make large scale acquisition like Facebook does. So I think this is a big step in the way for Apple which has made such kind of a deal for the first time in their 30 year history.
     
  8. Allison2021

    Allison2021 Well-Known Member

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    That was probably a good investment. The technology of those "ear muffs" can be applied to different products.
    Perhaps Dr. Dre can offer original content to go with that purchase. Yet three billion is a big deal; so, it better work for them.
     
  9. Gelsemium

    Gelsemium Senior Investor

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    Apple keeps buying and buying "small" companies with the technology they are interested in and that is why Apple makes the best products in the world. ;)
     
  10. nashvilleshelby

    nashvilleshelby Active Member

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    That is awesome. I mean I wish that I was majority share in Beats before the deal. I mean you see this brand everywhere. I have seen it for the past 3 years for sure in commercials, music videos, and even movies. He marketed the heck out of those things.
     
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