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Is Google buying Twitter?

Twitter might be seen as one of the untouchable companies in technology, one of the companies that survived the £50 million to £2 billion zone of buyout offer from older technology companies.

That may not be true though, with a new report from stock market firm Briefing claiming Google is eyeing up a potential acquisition of Twitter. In response, Twitter has hired Goldman Sachs to fend off buyout requests and attempts to acquire.

Twitter is currently valued at £22 billion, meaning it would be the highest Google acquisition surpassing the £8.5 billion acquisition of Motorola Mobility. It would also be the second highest technology related acquisition behind AOL’s tragic £72 billion acquisition of Time Warner, which ended in the complete destruction of AOL as a dominant figure in the tech world.

Google has been eyeing up Twitter for a few years now, clearly wanting some of that 140 character goodness. The search giant has tried multiple search networks including Orkut, Buzz and Plus, but none have been as successful as Twitter.

If it was able to acquire Twitter, it would be able to not only push Google services, but also finally own a social network capable of running new AdSense adverts. Google will most likely run Twitter similar to YouTube, as an outside entity with strong connections and CEO Dick Costolo would report directly to Google CEO Larry Page.

Even though it is a long shot, Google desperately needs social. It is losing out to Facebook in mobile advertising and its own pay-per-click rate has fell by 30 per cent in the past couple of years, showing the drop in search advertising.

Google has £41 billion in the bank, more than enough to acquire Twitter. It will more than likely use some sort of stock and cash split though, due to most of the cash accumulated by Google being stored in banks where it can avoid taxation.

Of course other suitors like Apple - who have £123 billion in the bank - might also be looking into a Twitter acquisition. We cannot see how it would be good for Facebook, but Microsoft might be interested in the social edge that Twitter brings.