Facebook offered to buy Twitter for $500 million of overvalued Facebook stock. Twitter rejected the offer for several reasons:
- At Facebook’s real valuation, $5 billion or so, the offer only amounted to $150 million (not bad for two-year old company with no revenue, but a far cry from the billion-dollar dream)
- Twitter has high hopes for its own secret revenue model which will be announced next year.
- Twitter’s investors aren’t stupid: They wanted cash. Facebook presumably doesn’t have that much cash to spare.
But TheDeal.com also reported that $100 million of the $500 million offer was cash so the third reason becomes invalid. All in all, twitter with getting so much popularity lately and the ease of use it offers to its users, the service has a lot of potential and is growing at an astonishing rate. $500M would seem nuts for a service like this and I believe that twitter has a potential to earn a lot lot more.
Anyway, lets see where this things settles.
[...] Twitter and the popularity of this micro blogging platform is so overwhelming that rejecting a $500 million takeover was a no brainer for most of us. This service has been used for quite a few purposes, like making [...]
[...] Twitter and the popularity of this micro blogging platform is so overwhelming that rejecting a $500 million takeover was a no brainer for most of us. This service has been used for quite a few purposes, like making [...]