HTC reduced ownership in Beats Audio by 25% - remains exclusive mobile partner - HTC Source
In a surprising move, HTC has announced that it will be reducing its investment in Beats Audio by roughly 25%. The deal will cost $150 Million and will return 24.53% of the company’s shares back to Dr. Dre and Beats’ current CEO Jimmy Iovine. While the official press release talks about providing “Beats with more flexibility for global expansion” we have a feeling that Beats simply wants some breathing room as it tried to get a strong foothold in the music screaming industry with its recent MOG acquisition.
Since HTC purchased a controlling share of Beats Audio last August, HTC has released about a dozen handsets with Beats’ equalizer software and a handful of devices which have been paired with various Beats headsets. Even with its reduced investment in Beats, HTC will be able to keep the title as the sole mobile provider to offer Beats Audio technology.
We know that many of you could care less about HTC’s partnership with Beats, but we honestly think there is still potential to capitalize on the popularity of Beats among general consumers.[quote]
HTC and Beats today announced a realignment of their business agreement that provides Beats with more flexibility for global expansion
1.Date of occurrence of the event:2012/07/21
2.Company name:HTC Corporation
3.Relationship to the Company (please enter “head office” or “affiliate company”):Head Office
4.Reciprocal shareholding ratios:N/A
5.Cause of occurrence:
HTC and Beats today announced a realignment of their business agreement that provides Beats with more flexibility for global expansion while maintaining HTC’s major stake and commercial exclusivity in mobile.
Under the terms of the agreement, the founding members of Beats will buy back 25% of its total shares for a total of approximately 75% ownership, with HTC remaining the largest outside shareholder with approximately 25%.
Over the last year, HTC and Beats have made great progress in sound innovation, product integration and brand awareness with successes like the HTC One. HTC and Beats will continue to work closely, including a joint global marketing campaign later this year.
7.Any other matters that need to be specified:N/A[/quote]