Twitter stock drops as bidders lose interest

Shares in Twitter fell more than 14% on Monday following reports that all of its rumored potential bidders have lost interest in buying the struggling social media company.

The shares, which spiked last month following speculation of a takeover by companies including Google, fell $2.82, or 14%, to $17.03 in early trading after Bloomberg reported that Twitter was unlikely to receive any takeover bids.

Google owner Alphabet, Walt Disney and Silicon Valley tech firm Salesforce have all been working with investment banks on a potential acquisition of the 140-character service. But Bloomberg reported over the weekend that all of the firms had decided not to press ahead with a bid.

Twitter’s shares already had fallen heavily at the end of last week after Silicon Valley technology news website Recode reported Google and Apple had decided against buying the company, which has been struggling to attract new users and build revenue.

Twitter’s stock market decline brings the company’s share price back below the level it was trading at before the takeover speculation was first reported on September 23.

The social media company, which floated on the stock market in November 2013 at $26 a share and whose shares reached a high of $69 soon after, had hired Goldman Sachs Group and Allen & Co to investigate a sale.

Twitter’s chief executive and co-founder Jack Dorsey was opposed to a sale, but fellow co-founder and board member Ev Williams supported it. The company is reported to have hoped to conclude a sale before it reported its third quarter results on 27 October.

Salesforce had been seen as the most likely buyer as its chief executive Mark Benioff had publicly expressed his interest in Twitter. However, he appeared not to have sounded out his investors in advance.

Benioff was forced onto the defensive at a shareholder meeting last week after many investors publicly and privately expressed their doubts about the deal.

“I read all of your notes; you probably know that,” he said at the meeting in San Francisco. “I also read your emails. And as I digest all of that information, this is actually the No 1 thing that has been on my mind. In some cases we have been unusually surprised and we have had to do a reset.”

Salesforce’s shares, which had been depressed following the Twitter acquisition speculation, rose by 5.4% to $74.70 on Monday – taking them back to roughly the level they were at before the takeover talk was first reported.

Source: TheGuardian