Beats purchases part of HTC’s stake

There was news in the past – in fact, just in August last year, that saw HTC picked up a 51% stake in Beats by Dr. Dre, but it seems that this particular acquisition has proved to be short lived. In fact, we have reliable word that HTC Corp. has now sold back 25% of its stake in Beats Electronics back to Beats’ founders, albeit in an attempt to smoothen ruffled feathers, the Taiwanese smartphone manufacturer mentioned that they will continue to work closely with Beats Audio for their future devices. I wonder what to make of the original $309 million investment that they made in August last year, as part of a (then) strategic move to prevent rising competition in the smartphone arena, while keeping their fingers crossed to enhance their products and branding. Despite a rather sizable chunk of their share changed hands in the sale, HTC remains as Beats’ largest shareholder at 25%.

Raul Sood, founder of Voodoo, remarked over on Facebook that this is a particularly good move for both HTC and Beats, as HTC probably made some money while Beats retains the control of their company, not only that, they are also able to chart new ways to grow their brand and market capitalization. What do you think?

Edwin Kee
Categories: Audio, Cellphones
Tags: beats, HTC