Twitter has been in talks with Yahoo about a possible merger, according to a report in The New York Post.
The social media company, whose user growth has plateaued, held a management-level meeting with Yahoo CEO Marissa Mayer in recent weeks, according to the report.
Yahoo is on the market and has received bids from at least 10 companies including Verizon and TPG for its core business, with some bids in the $US8 billion range. Twitter’s market value is around $US10 billion based on its current share price.
The Post’s report suggests that Twitter’s newsy output combined with Yahoo’s huge audience reach had some appeal to strengthening the value of both companies.
Twitter CEO Jack Dorsey was reportedly not in attendance at Mayer’s meeting, however, casting some doubt on how serious the talks really were.
From the Post:
… Twitter and Yahoo execs spent several hours hashing out Yahoo’s financials, and whether a strategic combo might make sense, according to sources close to the talks.
“Twitter is the destination for instant news, and Yahoo has a lot of eyeballs on its site,” said one source. “The idea isn’t as crazy as you might think.”
Nevertheless, Twitter appeared mainly interested in sucking information out of Yahoo, as it bowed out of the bidding process soon thereafter, sources said.
Indeed, one source noted that Twitter CEO Dorsey didn’t even bother to show up for the Yahoo meeting.
“When your CEO doesn’t show up for a management meeting, you have to wonder how serious it was,” the source said, adding that Twitter’s interest wasn’t driven by “some huge thesis — it was a flyer.”
There’s more at The New York Post.
The future of Yahoo may become clearer next week, when a second round of bids is due.