Reports that Google may be launching a new bid to purchase Twitter have seen the latter’s share value leap by 4.8 percent this week, adding more than £1bn ($1.5bn) to its value.
The fact that Twitter had hired Goldman Sachs as an adviser to fend off Google’s unwelcome attentions fuelled the share hike, although Google apparently isn’t acting alone. Briefing.com reports that another, so far unnamed, company besides Google is considering a Twitter buyout.
Having sidelined its own social networking ambitions (Google+) by separating products such as Google Photos from it and dropping its content authorship profiles form search (the driving force behind attracting journalists to Google+), the move toward Twitter seems like a curious one for the search giant. But given that Twitter’s trademark 140-character message sharing has attracted 288 million monthly active users and driven a market capitalisation of over $34bn, it may have seemed too tempting to overlook. Is Google thinking of jumpstarting its social networking ambitions again?
With a cash pile of more than $60bn, Google could afford it, even by offering (as would be expected) a generously above-market-value sum such as $50bn. But let’s not forget that rumours about Google buying Twitter have been circulating for years; and when you consider that a fair chunk of that Google cash pile is located outside the US in Europe, Asia and elsewhere, it would have to repatriate some of those funds and pay tax on them.
Way back in 2009, rumours were rife that Google was in late stage negotiations to acquire Twitter, and in 2011, well before Twitter’s 2013 flotation on the stock exchange, unconfirmed rumours began swirling that Google was in takeover talks (along with Facebook and several others) to bag the 140-character platform. Nothing came of either.
What are we to make of the latest reports? They’re almost certainly not mere Scotch mist, and it may be that Google is indeed making a serious takeover bid (no one, not even Twitter, hires Goldman Sachs advisers lightly). But we’ve been here before, several times, and there are questions about whether Google really needs another social platform to contend with Facebook.
The proverbial fat lady hasn’t started singing yet.
