Rumors on Google buying Twitter shoots up share value

By | April 9, 2015

Speculations about Google to buy Twitter has surfaced yet again after the two companies on join hands to allow live Tweets to appear in Google search results. Twitter has been discussed as a prospective target for more than five years so the latest hearsay that Google may acquire Twitter is all that surprising.

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More than $1.5 billion was added to the value of Twitter following the reports that Google may purchase Twitter. Twitter’s share values jumped 4.8%on reports. The US company has appointed Goldman Sachs as an adviser to fend off approaches.

A very similar situation was faced in January after unsubstantiated speculation of an acquisition by Google led to a 3.3% rise in Twitter’s stock. And that was not the first time Google had been interested in acquiring up tweeting platform. In 2009, Google was said to be in a final stage of discussions to get its hand on Twitter for $250 million, having just turned down Facebook’s advances but there was no news after it.

Ever since, there has been multiple rumors about the Google’s acquisition. The recent one was triggered by the Twitter tweets on Google search page. Engineers from the two companies are already working on integrating Twitter’s feed into Google’s search service. Google would start showing its tweets on its search engine later this year.

Analysts have jotted down how the agreement makes sense for both companies because it gives Twitter a means to promote its content and expand its availability to non-registered users. Mean while for Google, it offers a way to flesh out search results with more live content.

If Google’s interest on Twitter is real, it can expect to pay much more than it would have paid in 2009 when it first showed interest on the company. At that time, the value of the company was somewhere around $1 billion. Looking at the Twitter’s current market cap, it is safe if Google is ready to shell $60 billion cash reserve to buy out Twitter.