Twitter in Talks with Technology Companies Over Sale

A person with knowledge of the matter said on Friday that Twitter Inc. has begun talks with various technology companies for exploring the option of selling itself. This signals the start of what is probably going to be a slow-rolling auction of the money-losing yet high-profile social media company. For many months, the sale of Twitter has remained an on-again and off-again topic of rumors as the company is struggling with issues such as stagnant user growth, losses that are near hundreds of millions every year and soft advertising sales. The 10-year-old service has undoubtedly evolved into a powerful global source of entertainment, news and social company and yet its business struggles are still ongoing.

It was reported on Friday by anonymous sources that Twitter is currently talking to different companies, which includes Google and will probably get a formal bid soon. It was also reported that Salesforce.com has also expressed its interest in purchasing Twitter. Google’s parent company, Alphabet Inc., Twitter and Salesforce.com all declined to comment on the matter. Another company that was mentioned in the reports circulating on Friday include Verizon as a possible suitor. It said that they didn’t comment on any rumors, but they had definitely not submitted a bit for the social media firm.

After the reports hit, Twitter saw a rise in its share price by almost 19% as they reached $22.22. This marks the largest one-day rise in the share price of the company since they began trading in 2013. The market value of the company has now reached $16 billion. Analysts have said that the best acquirer of the social media company would be Alphabet as they have not been able to get traction on social media on their own, even though they have made some heavy efforts. As opposed to Salesforce, Alphabet would reap greater benefits from Twitter.

Omid Kordestani, the executive chairman of Twitter, is a former Google executive. It has been estimated that the purchase price of the social media firm would be around $22 per share. Sources with knowledge of the situation said that Twitter is working with investment banks like Allen & Co and Goldman Sachs in considering possible transactions. On Friday, the most unexpected development that occurred was Salesforce.com’s interest in acquiring Twitter. This is due to the fact that they have absolutely no presence in consumer media as it offers cloud-based computing services to business customers.

However, a recent presentation about its new artificial intelligence platform, Einstein, provided a peek as to how Twitter could actually be useful for Salesforce. The company executives have said that they have licensed the ‘firehose’ of all Tweets that are made on the platform and they make use of them for powering sentiment analysis and other tools, which indicate how brands and companies are being perceived and discussed. Marc Benioff, the Chief Executive of Salesforce, is active in numerous political causes in San Francisco and the location of the two companies is also quite close. Twitter had its IPO in 2013 for $26 a share.