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Twitter’s stock tanks after Salesforce walks

Twitter’s stock tanks after Salesforce walks
Walkout leaves Twitter without any potential acquirers

By Barry Eitel

SAN FRANCISCO (AA) – Shares of Twitter plunged more than 6 percent Friday after the chief executive of Salesforce said in an interview his company was not interested in acquiring the microblogging platform.

With Salesforce’s departure from the negotiating table, there are no serious bidders left for Twitter. Google’s parent company, Alphabet, Disney and Microsoft were all reportedly entertaining Twitter’s sales pitch in the past few weeks, but no deals materialized.

Salesforce, which focuses mainly on enterprise and cloud computing software, publically expressed interest in acquiring Twitter, but in an interview with the Financial Times Salesforce CEO Marc Benioff said hopes were dashed.

"In this case we've walked away,” he said. “It wasn't the right fit for us."

Benioff cited pricing and Twitter’s corporate culture as major reasons Salesforce was backing out.

Dropping to $16.66 per share, Twitter’s stock is nearing its all-time low. The company’s stock bottomed out in June at $14.02 after a disappointing quarterly earnings report revealed user growth had stalled.

In contrast, shares of Salesforce rose 6 percent amid the news.

Twitter declined to comment on Salesforce’s decision. The company is now facing more pressure to grow its base of 313 million monthly active users, which has fallen far behind Facebook’s global population of 1.71 billion.

Left alone, Twitter might attempt a buyout from private, individual investors instead of a large corporation. Activist shareholders on the board could also push the company to haggle with disinterested buyers, which have also included Verizon and Apple.

During most of 2016, the only bright spot for Twitter’s investors occurred when shares spiked while the company was courting buyers. The stock drifted downward as potential acquirers walked away, with the final pronouncement from Salesforce sending it to a two-month low Friday.

 

source: News Feed
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