Twitter Inc has initiated talks with several technology companies to explore selling itself, a person familiar with the matter says, signalling the start of what is likely to be a slow-rolling auction of the high-profile but money-losing social media company.
A sale of Twitter has been the subject of on-again, off-again rumours for many months as the company grapples with stagnant user growth, soft advertising sales and losses running at hundreds of millions of dollars a year.
The company’s business struggles have come even as the 10-year-old service has evolved into a potent global source of news, entertainment and social commentary.
CNBC, citing anonymous sources, reported on Friday Twitter was in talks with companies including Google and might receive a formal bid soon. A source told media Salesforce.com was also in pursuit.
Twitter and Alphabet Inc, Google’s parent company, did not respond to a request for comment. Salesforce declined to comment.
Verizon, another company mentioned in media reports on Friday as a possible suitor, said it did not comment on mergers and acquisitions rumours but that it had not submitted a bid for the company.
Twitter shares jumped more than 19 per cent to $US22.22 per share on Friday, marking the largest one-day rise since their first day of trading in 2013. The company now has a market value of around $US16 billion ($A21 billion).
Morningstar analyst Ali Mogharabi said Alphabet would be the best acquirer for Twitter since it had not yet been able to crack social media on its own despite several efforts.
“From a strategic standpoint, we think it would be more beneficial for Alphabet as opposed to Salesforce,” Mogharabi said. Former Google executive Omid Kordestani is executive chairman of Twitter.
Morningstar estimates Twitter could be bought for $US22 per share. Twitter was working with investment banks Goldman Sachs and Allen & Co in considering possible transactions, sources familiar with the situation said.
The most unexpected development on Friday was Salesforce.com’s interest in acquiring Twitter. Salesforce serves business customers with cloud-based computing services and has virtually no presence in consumer media.
But a recent presentation about its new “Einstein” artificial intelligence platform provided a peek at how Twitter could fit into the company’s strategy .
Salesforce executives said they licensed the Twitter “firehose” of all tweets that came through the platform and used it to power sentiment analysis and other tools that showed how companies and brands were being discussed and perceived.
Salesforce chief executive Marc Benioff is active in political causes in San Francisco and the two companies are just blocks from each other in the city.
Salesforce’s chief digital evangelist, Vala Afshar, tweeted on Friday: “Why @twitter? 1 personal learning network 2 the best realtime, context-rich news 3 democratise intelligence 4 great places to promote others.”
Later, Afshar added: “I have tweeted my personal views regarding ‘Why Twitter?’ numerous times over the past couple of years. I simply love Twitter.”
