Twitter shares surge on talk of sale or takeover
SAN FRANCISC O Twitter Inc. is holding informal talks with several potential buyers and is working with Goldman Sachs Group Inc. to help with a possible deal, people familiar with the situation said.
Salesforce.com Inc. is one of the main parties interested in the San Francisco-based social media company, said the people, who asked not to be named because the information isn’t public. Twitter is also working with Goldman on options besides a full sale, like a divestiture of non-core assets, one source said.
Twitter’s stock has fallen after several quarters of slowing growth, putting it in play as a potential takeover target. The company is still attractive because of its data, user base and influence in politics, culture and the media. Twitter recently expanded into live video streaming, making it possible for some users to watch NFL games for free. It’s making similar deals for content related to politics, business and entertainment.
Twitter co-founder and board member Ev Williams fuelled takeover speculation last month when he said in an interview the company has “to consider the right options.” He was responding to a question about whether Twitter can remain an independent company.
Twitter shares surged as much as 23 per cent to US$22.89 on Friday after CNBC the company has received expressions of interest from several technology or media companies and may get a formal bid shortly. The stock closed at US$22.62, up 22 per cent.
Salesforce earlier this year unsuccessfully bid to acquire LinkedIn Corp., and Twitter could provide similar benefits. Though Twitter is typically considered a consumer product, the social me- dia company’s 313 million monthly active users include many professionals — people who Salesforce customers already may be targeting for potential deals. Its data may help improve the Salesforce software that companies use to manage customer relationships.
More than 70 per cent of sales professionals use social selling tools, including LinkedIn, Twitter and Facebook, to help close a deal, build stronger relationships and expand revenue, according to LinkedIn. And Salesforce itself in 2014 said Twitter was the “largest cocktail party in the world,” according to a post on its website.
Based on the value of Microsoft’s LinkedIn deal, Twitter is worth US$16.7 billion, excluding cash, Bloomberg Intelligence estimated. Twitter share gains Friday left the company with a market value of US$16.01 billion, according to data compiled by Bloomberg.