Apple's rumored acquisition of Beats will indeed happen, just for a slightly reduced fee, according to a report from the New York Post this evening. The acquisition, which was originally reported to be roughly $3.2 billion for both Beats companies -- the headphone and consumer electronics division as well as the streaming music service -- will now happen at $3 billion.
Since the acquisition was originally reported on May 8, Spotify -- the leading player in the subscription music field -- announced that it had 10 million paying subscribers, and this could have given Apple additional negotiating leverage.
The paper notes that both Jimmy Iovine and fellow Beats co-founder Dr. Dre are expected to attend Apple's Worldwide Developer Conference next week. Dre is expected to net somewhere around $750 million from the sale as he currently owns approximately 25 percent of the company.Still, the company is understood to place a high value on the profitable Beats audio business which retails headphones -- costing up to $450 -- and speakers around the globe.
That business recorded sales of $1.3 billion in 2013.
"Apple hadn't even begun its due diligence process when news of the number came out," one source close to the talks said Tuesday.
Article Link: Apple to Announce Beats Acquisition This Week, Drops Price to $3 Billion