Twitter Shares Plummet As Google And Disney Drop Purchase Talks
Twitter shares plunge after Google and Disney drop out of bidding
Twitter shares have fallen by almost a fifth after Google and Disney, two prospective buyers, pulled out of the running for the company.
The two were seen as the most likely buyers of the social network, which has seen its value soar in recent weeks amid speculation it is setting itself up for a sale.
It is believed to leave Salesforce, the American business software company, as the most likely buyer, reducing the likelihood of a bidding war for Twitter and raising the prospect of it not being bought at all.
Twitter’s shares fell by more than 18pc in early trading in New York, knocking $3.2bn (£2.5bn) off the company’s value, after Silicon Valley website Recode reported that Google and Disney would not be lodging formal bids.
While neither company had confirmed they were considering offers, they were both believed to have appointed advisers to explore the option.
Google, whose own efforts in social media have fallen flat, has long been rumoured to be interested in acquiring Twitter and was seen as the most likely buyer. Disney was seen as a less plausible candidate despite strong ties between its chief executive Bob Iger and Twitter founder Jack Dorsey.
Salesforce shares have fallen by around 4pc since rumours of the company’s interest in buying Twitter emerged. It missed out on buying LinkedIn when Microsoft reached a $26bn deal to buy the professional social network earlier this year, and is believed to see potential in turning Twitter around.
However, this week its chief executive Marc Benioff said: “We have to look at everything, but we’re going to pass on most things.”
Twitter has struggled to live up to the lofty expectations generated by its early growth and the tremendous success of Facebook since it went public three years ago. It has not made a profit in its 10-year history and revenue growth has slowed dramatically in recent months.
Though beloved of celebrities and other public figures, Twitter has failed to reach the user numbers enjoyed by Facebook or Instagram.
Backers believe the influence it exerts across the media, the reams of data it generates and its position as a source of live news make Twitter valuable, but shares have more than halved since it floated.