Published May 28, 2014Earlier this month, Dr. Dre declared himself "the first billionaire in hip-hop" when rumours spread that Apple had purchased his Beats Electronics headphone company for an incredible $3.2 billion. Now, the sale has officially been announced.
The sum of the purchase is actually around $3 billion. That's around $2.6 billion for the initial purchase and an additional $400 million that will vest over.
This deal includes Beats headphones in addition to the company's Beats Music streaming service. This will mean that Beats can compete with streaming giants like Spotify and Rdio.
As part of the acquisition, Beats co-founders Jimmy Iovine and Dr. Dre will join Apple. Considering Iovine's new role, he also today announced that he is stepping down from his role at Interscope.
Apple exec Eddy Cue said in a statement, "The addition of Beats will make our music lineup even better, from free streaming with iTunes Radio to a world-class subscription service in Beats, and of course buying music from the iTunes Store as customers have loved to do for years."
The deal isn't closed quite yet, since it's still subject to regulatory approvals. It's expected to be finalized by the fourth quarter of this year.
When Dre first declared a billionaire earlier this month, Forbes was quick to point out that he may have spoken to soon. Based on his stake in Beats (which is around 20 percent or 25 percent) and taxes, his net worth would actually be around $800 million. Still, it looks like he is officially now the richest man in hip-hop.