Apple Inc. (NASDAQ:AAPL) is one step closer to acquiring Jimmy Iovine’s and Dr. Dre’s Beats Electronics thanks to an approval from European regulators announced Monday. According to a public statement released by the European Commission, the governing body had no objections to the proposed merger due to the small combined market share of Apple and Beats Electronics along with their different hardware product offerings.
“The commission concluded that the combination of the two businesses did not raise competition concerns because the combined market share of Apple and Beats Electronics is low,” the European Commission said. “In addition, Apple and Beats Electronics are not close competitors because the headphones they sell differ markedly in functionality and design.”
The commission reinforced its assessment, noting “a large number of global competitors such as Bose, Sennheiser and Sony would remain” after the acquisition is completed.
The analysis of Apple’s acquisition of Beats also included the impact of acquiring Beats Music. Since Beats Music isn’t available in Europe and Apple faces additional competitors such as Spotify and Deezer, the European Commission found it “implausible” the Beats Music acquisition would lead to “anticompetitive effects” or affect the access of competing apps to the iOS mobile operating system platform.
With the European Commission’s approval now out of the way, the $3 billion acquisition of Beats Electronics first announced in May is closer to completion. But, until Apple receives regulatory approval from regulatory bodies in the United States, the acquisition of Beats remains up in the air.
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Beats Electronics has also found itself with new legal obstacles after Bose filed a legal complaint against the Culver City, California, headphone manufacturer July 25, alleging Beats infringed on several noise cancelation technology patents held by the Framingham, Massachusetts, company. It’s currently unknown how the lawsuit may affect the deal with Apple and Beats Electronics.