Twitter Inc. (TWR.N) has initiated talks with several technology companies to sell itself. News has it that Twitter has been losing a lot of money depsite its high profile. The company for sometime has been struggling with issues like stagnant user growth, soft-advertising sales annd losses running at millions of dollars per year even though it is a potent global source of news, entertainment and social commentary. It has failed to keep pace with rivals, especially Facebook’s Instagram and Snapchat. Both of which now boast of more users than Twitter by most measures even though they are much newer, and advertisers have began to leave to spend their Ad money on other platforms.
Since it’s decision to sell however, various technology companies have shown interest in it. According to reports, Google, Salesforce.com, Verizon amongst others have shown interest in buying the company. This however gave Twitter’s shares a rise from 19 per cent to 22.22 dollars per cent share in a day. This is happening for the first time since Twitter’s inception.
Disney has joined the list of Twitter’s suitors. In fact, Disney is working with bankers now to determine whether the deal makes sense. It is right to know this because Twitter’s shares which as at last week was below 13bn dol before the rumours of acquisition broke. Now, Twitter’s market capital is almost 20bn, which is higher than Disney’s. Because of the decline in cable viwership, companies like Disney are looking for new platforms to expand the reach of their leading brands. Disney is planning to acquire Twitter because it needs a social media platform to amplify its reach.
Twitter’s live streaming efforts with companies like NFL and its own periscope platform have made it a ”hot-cake” for interested buyers. News of the Disney-Twitter deal have been juiced a bit by the fact that Jack Dorsey, Twitter’s co-founder who returned to the company as Chief Executive in 2015 serves on Disney’s board. Well, the wait is still on.