On Wednesday, Cramer had expressed that any company willing to purchase the struggling social network Twitter can expect a major plunge in their stock and earnings challenges for at least a couple of years.
Now Salesforce wants to make things super clear for everyone — no, the company won’t buy Twitter. Salesforce CEO Marc Benioff gave an interview to the FT and said that the company ruled out the acquisition.
Despite the possible immediate consequences to the company, Cramer has said that he sees Twitter as a plausible benefactor to Salesforce due to the company’s stockpile of user data.
“In this case we’ve walked away. It wasn’t the right fit for us,” Benioff told the FT. If you were looking for an official confirmation, it can’t get more official than that.
Two weeks ago, nearly all suitors announced at the same time that they weren’t interested by Twitter after all. Google, Apple and Disney don’t want to buy Twitter anymore. Salesforce was the last remaining suitor.
While the company could have used this opportunity to lower the acquisition price, it wasn’t the case. During an investor meeting, Benioff already said that Twitter wasn’t the right fit for Salesforce. He even ended up saying “I wish Jack very well.”
But many thought Benioff was quite excited about the idea of buying Twitter. So what happened exactly? Salesforce’s largest shareholder Fidelity Investments was against the deal. And given that Fidelity owns 14 percent of Salesforce, it would have been hard to buy Twitter with the board’s approval. This is probably the wisest decision for Benioff.
Following the FT’s interview, Twitter shares are crashing once again. Shares are down 6.86 percent to $16.57. Twitter’s market cap is now $11.6 billion.
Source: Romain Dillet (@romaindillet), CNBC