Beats Brings HTC Partnership To An End With $265 Million Buyback
Beats Electronics has brought its partnership with HTC to a close by buying back the 24.84% stake that the Taiwanese smartphone maker held in the company for $265 million. The two-year partnership saw Beats Audio technology integrated into HTC handsets, but Beats itself never really got anything out of it.
HTC initially purchased a 50.1% stake in Beats — which was founded by Dr. Dre and music mogul Jimmy Iovine — for around $300 million back in 2011, but it agreed to sell back more than half the shares about a year later for $150 million.
Back in August, The Wall Street Journal reported that Beats was then looking to cut its ties with HTC completely and join forces with a new investor that could help Beats expand into new markets, such as portable speakers, in-car audio systems, and other consumer electronics.
Recent reports have suggested the company is also planning to launch a new music streaming service that will go head-to-head with the likes of Spotify and Rdio.
Beats first tried to end its relationship with HTC earlier this year when it attempted to raise $700 million to refinance its debut and buy back HTC’s 25% stake in the company. But according to WSJ, investors questioned whether its success in the headphone market could be sustained, and they eventually backed out of a potential deal.
This may not be the end of Beats and HTC entirely, however. HTC insists that Beats is still an important partner, and it has said that it will “continue to partner [with Beats] as future opportunities arise.”
