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Will Twitter Be the Latest Addition to Salesforce’s Portfolio?

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Twitter’s probable acquisition by Salesforce

So far, 2016 has seen some prominent acquisitions in the technology space, including the Demandware, Blue Coat Systems, and LinkedIn acquisitions by Salesforce (CRM), Symantec (SYMC), and Microsoft (MSFT), respectively. Oracle’s (ORCL) announcement to add Netsuite to its portfolio also counts as a notable acquisition, although due to certain factors, it is currently delayed.

The latest news floating in the tech space, according to a recent Wall Street Journal report, is that Salesforce is considering an acquisition of Twitter (TWTR). The rapid increase in technology acquisitions shows that competition is growing rapidly in the cloud and technology space. Salesforce’s appetite to acquire companies confirms this. In the recent past, Salesforce CEO Marc Benioff, while commenting on M&A (mergers and acquisitions) and the Demandware deal, stated that “the M&A season is the most intense, most exciting I’ve ever seen. I’ve never seen more deals and more things happening.”
Twitter revenue

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Twitter’s expertise is vastly different from Salesforce’s

Twitter’s acquisition by Salesforce appears to be in sync with its ongoing acquisition strategy as well as with the M&A spree in the technology space. However, analysts find it difficult to understand how Twitter, which operates in the social networking space, would complement Salesforce, which generates the majority of its revenues from software subscriptions.

According to 24/7 Wall St., this skepticism was addressed by MarketWatch, which stated that “buying Twitter does not appear to make much strategic sense for the cloud computing company. Salesforce already has a deal with Twitter, in which its sales-force customer base uses Twitter’s vast amounts of data for lead generation in real time.” Later in this series, we’ll discuss the factors that have made Twitter an attractive acquisition target—not only among tech companies, but in the media space as well.

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