A while back, we reported to you that Beats was looking to buy out HTC’s stake in its company as soon as possible. The Taiwan manufacturer has been struggling for quite some time, even with the introduction of the flagship smartphone, the HTC One, has not saved the company from continuously losing business. According to a new report from NASDAQ, Beats has successfully bought back HTC’s 25% stake in the company.
Beats was looking for an investor a while back, and it finally found one. The company secured an investment of $500 million from Carlyle Group and bought out the 25 percent stake in itself from HTC for $265 million. The exact details of the deal have not been disclosed, however, what we do know is that the asset management firm will also take two (out of six) seats in Beats’ board.
Here is what Sandra Horbach, Carlyle’s head of consumer and retail, said in a statement:
“We are confident that Beats will continue to drive innovation and growth in the premium audio accessory market, particularly as the proliferation of smart phones and tablets stimulate increased consumption of digital media.”
Originally in 2011, HTC owned 51% stake in Beats Electronics at the cost of $309 million. HTC started to imbed Beats into its smartphones such as the HTC One X and HTC One. It seemed like a good selling point for HTC, but the company didn’t see much improvement in its marker share. Then in 2012, the company sold half of its stake back. Beats Electronics on the other hand has been growing, capturing 59% of U.S. premium headphones market.
It’s highly unlikely that Beats will continue to feature in HTC’s headsets. As for Beats Electronics, the investment from Carlyle Group will help it move into new markets and expand business.
What are your thoughts?
Be sure to follow us on Twitter and like us Facebook for latest news, random giveaway, and deals!
