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Sources: Twitter Wants a Massive $30 Billion for Buyout

Friday, September 23, 2016 11:33
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(Before It's News)

Social media giant Twitter Inc (NYSE:TWTR) saw its shares explode higher today on imminent takeover rumors, but its reported asking price may make finding a buyer very difficult.

According to Recode, which spoke to sources close to the situation:

While we estimated an $18 billion price tag based on the recent sale of LinkedIn to Microsoft, two sources said Twitter was looking for much more to sell. The number? At least $30 billion.

Yikes. That could knock Salesforce out, although it made a serious run at LinkedIn which went for $26 billion a few months back. (That said Salesforce’s market cap is just under $50 billion, lower today by 5 percent due to the Twitter rumors, meaning Wall Street no likey).

So that may leave Google, Microsoft, and Verizon as the final three potential suitors, assuming no others emerge in coming days. It’s unclear whether any company — even if they have the money — would be willing to pony up such a large sum for a troubled company like Twitter, whose user growth has stalled and advertising demand has waned.

The company could soon have no choice, however, if its earnings continue to disappoint. At that point, it may need to take whatever price it can get — which certainly won’t be the near 100% markup over its current price that it’s looking for.

TWTR-2016-09-23(2)

Twitter shares rose $3.44 (+18.47%) to $22.07 in Friday afternoon trading. Due to today’s big surge, TWTR has pared much of its 2016 losses, with the stock now down only 4.17% year-to-date.

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