2015-06-11

Should Google Buy Twitter? (videos)

UPDATE: Twitter CEO Dick Costolo is out and co-founder Jack Dorsey, who is also CEO of Square, will serve as interim-CEO effective July 1. Costolo will reportedly remain on the board.
Investors (see below) had been calling for changes in Twitter's strategy--stock is up in after-hours trading.



Om Malik: Google Should Buy Twitter - Om Malik, a partner at True Ventures, and Bloomberg's Joshua Topolsky preview Twitter's 2015 Annual Meeting of Stockholders on Wednesday, June 3, 2015 . They spoke with Bloomberg's Emily Chang on "Bloomberg West" (June 3, 2015).

Stock Exchange: Stock Symbol(s) - market capitalization (June 5, 2015):
  • NYSE: TWTR - $24.23 Billion
  • NASDAQ: GOOG, GOOGL - $369.97 Billion
Google is holding $65 Billion in cash - source: Sizemore Insights | charlessizemore.com. See also: Google's Cash Position | Seeking Alpha.

Twitter 2015 Annual Meeting
Chris Sacca, 40-year-old California billionaire and Twitter stockholder wrote a blog post critique of  over 8,000 words that was published and widely noted hours before Twitter’s annual shareholder meeting ... Later in the afternoon in an interview with CNBC [see below], Sacca said Twitter would be a “good fit” for an acquisition by Google see video below.



 "Twitter would be an "instant fit" for Google, should the Internet search giant acquire the company, early Twitter investor Chris Sacca said Wednesday. "I think it's a fantastic use of Google's cash," the founder of Lowercase Capital said in an interview with CNBC's "Closing Bell" [above]. "This is the thing that Google has never had. They've never understood social, they've never understood those personal interactions. This bolts right in cleanly... Sacca also stressed that he wasn't threatening to sell his stake in Twitter. "I'm not out there selling shares ... This is a very, very long-term hold, and I know this company is going to be massively more valuable than it is today."" source: CNBC.com (emphasis added)

See: Chris Sacca--What Twitter Can Be. | LOWERCASE capital

And a critique on Seeking Alpha of  Sacca's article--excerpt below--

"... Perhaps the biggest mistake Sacca made was in not establishing his bona fides before launching. Sacca, a former Google employee, is well known in Silicon Valley, but almost completely unknown on Wall Street. What the Street wanted was for Sacca to shop his ideas around privately, to specific private equity firms and brokerages, before going public ... In fact, like many tech guys, he's probably on to something else right now ... But that's not how Wall Street works. These ideas are great, but they're not going anywhere, and neither is the stock until something like them is taken seriously. If Dan Loeb or Dan Ackman wrote this, in other words, we'd all be screaming buy, buy, buy..." --Why Sacca's Twitter Gambit Failed | Seeking Alpha (emphasis added)

 see also: Twitter Announces Secondary For Shares Related To TellApart Buyout: How Successful Will It Be? - | Seeking Alpha

 Domain Mondo opinion:
1. Should Google Buy Twitter? From Google's viewpoint--Yes--Twitter has what Google needs in Social and Mobile and this--Facebook and Twitter Will Take 33% Share of US Digital Display Market by 2017 - eMarketer--Google needs the Twitter platforms for mobile advertising growth.
2. Will Google use any of its cash or earnings for dividends or buybacks? No, not in the near future. Brin and Page are relatively young and have too many acquisitions and new projects still to do before Google starts "throwing off" cash to stockholders, unless, of course, the stock price becomes too "cheap"--and then, only provided Google does not otherwise have better use for the cash.

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