HTC returns half of Beats stake in 'biz realignment'

HTC has reached an agreement with Beats Electronics to sell back about half of its stake to the headphone maker for US$150 million.

Under the agreement, Beats' founding members will buy back 25 percent of its total shares to increase its ownership to 75 percent. HTC will remain the largest external shareholder with approximately 25 percent share, the Taiwanese smartphone maker said in an e-mail statement.

The move was part of a "realignment of their business agreement" to give Beats more flexibility to expand globally, while maintaining HTC's major stake and commercial exclusivity in mobile, according to the statement. Both will continue working closely on various initiatives, including a global marketing campaign later this year.

Last August, HTC announced it would acquire a 51 percent stake in Beats Electronics through its HTC subsidiary in the United States for US$309 million, The Taipei Times said on Monday.

Beats on Jul. 3 announced its acquisition of digital music streaming service, MOG, for US$14 million, as it aimed to establish a foothold in various parts of the digital music platform. HTC then had agreed to offer a US$225 million loan to Beats to fulfil their working capital requirement, the Taiwanese news site said, citing a separate statement.