Rupert Murdoch’s News Corp said rumours about the company’s interest in buying Twitter or building a stake in it were untrue, after suggestions of the media giant’s interest sent Twitter shares soaring.
Twitter’s shares, which rose as much as 14 per cent on Wednesday, pared some gains and closed up 4.1 per cent. The stock rose from a record low after unconfirmed chatter about News Corp’s interest in Twitter circulated on Wednesday.
The social media site has been seen as a takeover target because of the company’s shrinking stock price.
In the few months since co-founder Jack Dorsey returned as the chief executive, Twitter has been trying to make the site more engaging. The company said in December it was testing a feature to show ads to people who read tweets without logging in as it tries to make more money from non-active users.
“Twitter inside a larger organisation definitely makes theoretical sense, whether its another internet company or a media company,” Monness, Crespi, Hardt, & Co analyst James Cakmak said.
A News Corp spokesman said there was no truth to the rumours.
Twitter already has several high-profile investors. Former Microsoft Corp chief executive Steve Ballmer reported a 4 percent stake in October, making him the third-biggest shareholder after Twitter co-founder Evan Williams and Saudi billionaire Prince Alwaleed bin Talal.
Twitter has been the subject of takeover rumors in the past, including a previous fake report attributed to Bloomberg that claimed the company had received an offer to be acquired for $31 billion (£22 billion).
Jack Dorsey became Twitter’s chief executive last year
Twitter had received bids from Google and Facebook, according to reports.
“Even though News Corp denied the rumors, I do think this could help investors potentially see some valuations for the stock,” Cakmak added.
Shares have fallen nearly 41 per cent since Dorsey was named permanent CEO in October.
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Source: Telegraph UK