Salesforce Drops Pursuit of Twitter (Report)

One of the embattled social network’s last remaining suitors bows out

Last Updated: October 14, 2016 @ 12:18 PM

Twitter’s stock plunged 6 percent Friday morning after decided that it was no longer interested in acquiring the social network.

Salesforce CEO Marc Benioff told the Financial Times that Twitter was “not the right fit for us for many different reasons.” Salesforce, an enterprise software firm with a very popular customer resource management product, had been in discussions with Twitter about a potential acquisition for weeks. The two companies have had a business partnership since 2012.

However, Benioff faced backlash from some of Salesforce’s major shareholders, led by mutual fund giant Fidelity Investments, which owns about 14 percent of the company. According to the New York Times, a Fidelity portfolio manager emailed Benioff to express his disapproval with the proposed deal, and other Salesforce investors indicated that they’d sell their stock.

Neither Salesforce nor Twitter is profitable.

Twitter went public with an IPO price of $26 per share, and it closed just shy of $45 its first day. However, as the social network has struggled to grow its user base — and changed its CEO — shareholders have grown impatient and dumped their stock. And while Facebook’s shares continue to climb, Twitter hasn’t traded for more than its IPO price since late last year.

Acquisition rumors have heated up as Twitter’s falling share price makes a deal cheaper, but suspects including Google, Apple and Disney have all decided against bidding. With the Salesforce deal seemingly dead, Twitter may be out of white knights.