Is Disney about to buy Twitter for $16bn?

Family-first media giant Disney is no longer just about anthropomorphic mice and creepy clubhouses. The company is reportedly preparing a bid to buy social network Twitter.

In a deal that could inject Twitter with some much needed cash, and give Disney a foothold in the fervent social networking advertising space, the company is currently “working with a financial advisor” to assess the validity of the deal. This according to a Bloomberg report.

If Disney does purchase Twitter, the deal is expected to be worth around US$16bn

According to the publication, bidding Twitter’s market worth of around US$16-billion will be Disney’s biggest cash splash since 1996. This includes its purchase of Pixar back in January 2006 for US$7.4-billion.

But why would a company like Disney consider purchasing an ailing social media platform like Twitter?

Why Twitter?

For one, advertising. It’s Twitter’s chief income stream, which saw a 31% jump in Q4 2015. Mickey Mouse’s owner, with its marketing prowess, could put this to good use. But while advertising might be the company’s strong point, it’s not doing much to drive overall profits. Overall, Twitter’s revenue has been steadily declining since mid-2014.

Another possible avenue is live media. ESPN, which is 80% owned by the media giant, could leverage the platform’s Periscope live streaming service for sport-related broadcasts, or push more content through Twitter Moments — the company’s rich media news catalogue.

Ultimately, what the company will also purchase is Twitter’s 320-million monthly user base.

But while Disney is perhaps the most exciting buyer, it is by no means the only in contention. Salesforce is also pondering the purchase of Twitter, while — in what could be quite the coup — Google is rumoured to also be exploring possibilities.

Feature image: Sam Howzit via Flickr