"Company A said they want to be notified if we get acquisition talks wiht company B. The only reason for this is so they could make a counter-offer[1].
If Company A would only buy us to keep us out of Company B's hands then they probably don't care about us and would let us wither
So why bother?[2]"
[1] I cannot think of another reason that would cover such a short timescale
It might also cause trouble with company B "Yeah, we promised your rivals we would tell them if someone like you approached us" is probably not the best foot to start off with :p
Given track records, if the founders of WhatsApp wanted to keep the business going, selling to Google would have been a wrong choice. Personally, I am still waiting to see what happens to Waze as it's window of freedom comes to a close.
With Instagram and the promises made for WhatsApp by FB, this seems like a very good decision.
I can believe Google made the offer and it was rebuffed.
But, I think the price paid here suggests there were other bidders. And, while an acquirer making an offer may want to enforce a 'no shop' agreement, the acquisition target usually wants more bidders. (Does Sequoia keep secrets from Google, when a Google bid could maximize their return?)
So I'd guess Google knew WhatsApp was discussing acquisitions.
I'd love to hear more definitively about how these competing priorities play out in a real high-stakes acquisition negotiation. (Could a Facebook, via a early rich term sheet, cajole a 'no shop' agreement from a target and expect it to stick?)
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[ 3.5 ms ] story [ 32.8 ms ] thread"Company A said they want to be notified if we get acquisition talks wiht company B. The only reason for this is so they could make a counter-offer[1].
If Company A would only buy us to keep us out of Company B's hands then they probably don't care about us and would let us wither
So why bother?[2]"
[1] I cannot think of another reason that would cover such a short timescale
[2] ok, money, but it is still a hassle.
It might also cause trouble with company B "Yeah, we promised your rivals we would tell them if someone like you approached us" is probably not the best foot to start off with :p
With Instagram and the promises made for WhatsApp by FB, this seems like a very good decision.
But, I think the price paid here suggests there were other bidders. And, while an acquirer making an offer may want to enforce a 'no shop' agreement, the acquisition target usually wants more bidders. (Does Sequoia keep secrets from Google, when a Google bid could maximize their return?)
So I'd guess Google knew WhatsApp was discussing acquisitions.
I'd love to hear more definitively about how these competing priorities play out in a real high-stakes acquisition negotiation. (Could a Facebook, via a early rich term sheet, cajole a 'no shop' agreement from a target and expect it to stick?)