Apple has bought Beats Music and Beats Electronics for US$3 billion in a bid to boost its streaming business.
Apple is acquiring the two companies for a total of US$3 billion, consisting of a purchase price of approximately USD2.6 billion and approximately USD$400 million that will vest over time.
The deal is less than the $3.2 billion first reported by the Financial Times.
The deal is Apple's largest acquistion to date.
Beats co-founders Jimmy Iovine and Dr. Dre will join Apple as part of the deal.
Apple chief executive, Tim Cook, said music held a special place at Apple.
“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.”
Iovine said he had always known in his heart that Beats belonged with Apple.
“The idea when we started the company was inspired by Apple’s unmatched ability to marry culture and technology," he said. "Apple’s deep commitment to music fans, artists, songwriters and the music industry is something special.”
Apple senior vice president of internet software and services Eddy Cue, said the addition of Beats would make the companies music lineup even better
"From free streaming with iTunes Radio to a world-class subscription service in Beats, and of course buying music from the iTunes Store as customers have loved to do for years.”
Subject to regulatory approvals, Apple expects the transaction to close in fiscal Q4.
Beats was founded in 2008 by producer Dr. Dre and Chairman of Interscope Geffen A&M Records, Jimmy Iovine,
Beats Electronics (Beats) comprises the Beats by Dr. Dre family of premium consumer headphones, earphones, and speakers as well as patented Beats Audio software technology and streaming music subscription service Beats Music.
Beats Music is a subscription streaming music service that focuses on providing a personalised music experience.