Sam Oliver
Apple will know whether European antitrust authorities will clear its $3 billion deal for headphone maker Beats by the end of next month, paving the way for the acquisition to close before the end of Apple's 2014 fiscal year.
The deadline announcement came from the European Commission earlier Wednesday, according to Reuters. Though there is no word on what the Commission's decision will be — the body could demand concessions if it views the agreement as anticompetitive — Â a challenge is unlikely.
It is still unknown which agency will review the sale in the U.S. Federal law mandates that Apple report the deal to both the Federal Trade Commission and the Department of Justice's antitrust division, but the two agencies traditionally divvy up investigations between themselves.
Despite Beats's dominant position in the headphone market, Cupertino, Calif.-based Apple expects a swift confirmation from antitrust regulators around the world. Apple chief Tim Cook has said that he believes Beats will add to Apple's revenues beginning in his company's fiscal fourth quarter, which ends in September.
Apple announced the Beats deal late last month, paying some $2.5 billion for the premium headphone business and another $500 million for the nascent Beats Music streaming service. Beats cofounders Jimmy Iovine and Dr. Dre will also come on board as Apple executives, reporting to marketing chief Phil Schiller and services guru Eddy Cue.
Charles Martin
Christine McKee
Malcolm Owen
Sponsored Content
Amber Neely
48 Comments
Don't see why/how approval of this could remotely be an issue.
Don't see why/how approval of this could remotely be an issue.
It's Europe, they'll squash this deal because Timmy and Jimmy rhyme and the names look too much the same.
Lol
Apple and Bears are American companies, right? How does the EU commission have any jurisdiction in the matter? Just for the sake of argument: what happens if they say "no" and Apple acquires Beats anyway?
Apple and Bears are American companies, right? How does the EU commission have any jurisdiction in the matter?
Just for the sake of argument: what happens if they say "no" and Apple acquires Beats anyway?
The EU has jurisdiction over what is traded in the EU. But it hardly seems to be an issue .. the anti-trust approval is a formality, but since beats in the EU has nothing approaching market domination in the Headphones market, its not going to be an issue. Regarding other Beats activities there may be some issues, but there will be no show-stoppers.
Turning to the other question: What happens if Apple goes ahead despite a veto ... then they go out of business in the EU. I don't think any sane company will try to defy the EU in anti-trust issues. They may dispute the decision in front of the EU court of justice and could conceivably have some success in that, but defying an order would be corporate suicide and apple is simply not that dumb. The stakes would be really high. Antitrust and anticompetitive activity is serious in the EU (also in the US, but on that side of the atlantic there's more lobbyism and bought courts and politicians).
So in all there doesn't really seem to be any risk.