Watch out Diddy, Dr. Dre will be taking over that No.1 spot on Forbes’ list of “Hip Hop’s Wealthiest” if Apple closes in on its plan to acquire Beats Electronics for a whooping $3.2 billion.
According to a New York Times report, a deal could be announced as soon as next week.
If this transaction does go through (sources warn that it could still fall apart), it would mean a major break in Apple’s acquisitions strategy. Thus far, the Cupertino, California-based tech juggernaut has focused mostly on buying technology providers to incorporate under its own umbrella.
Purchasing Beats would signal a major paradigm shift for Tim Cook, CEO of the iPhone maker. Under the late Steve Jobs’ tenure, Apple was unwilling to acquire established brands. Now, the company has been forced to go outside its once transformative technology labs to remain cool and make an impact.
Beats, which was founded in 2006 by the legendary producer and Interscope-Geffen-A&M Records chairman Jimmy Iovine, features the immensely popular premium headphone and speaker line, as well as the recently launched Beats Music , a streaming music service that competes with Spotify and Apple’s iTunes.
Carlyle made a $500 million investment in Beats back in September of last year and valued the company at more than $1 billion.
“In terms of acquisitions, Apple has been very, very light in their activity,” Moody’s analyst Richard Lane told the Financial Times. “I don’t think they’ve spent $1 billion in any of the last four years.”