Bloomberg said on Tuesday that Microsoft Corp (NASDAQ: MSFT) wants to buy Discord for over £7.24 billion. Discussions for the said acquisition, as per the report, are ongoing.
Microsoft shares remained almost flat on average in premarket trading on Tuesday. The stock is currently exchanging hands at £171 per share. In comparison, Microsoft had started the year at a per-share price of £158 after recovering from a low of £100 per share in late March 2020 when the COVID-19 crisis was at its peak. Here’s what you need to know about why do prices rise and fall in the stock market.
Discord might choose to go public
The deal, however, has not been finalised yet as the video game-focused chat platform is also in talks with other potential buyers. According to Bloomberg, Discord previously also held discussions with Epic Games and Amazon.
One source, the report added, said it was more likely for Discord to opt for going public instead of striking an agreement with a potential buyer. The instant messaging platform is currently valued at roughly £5.08 billion after raising close to £348 million, as per Crunchbase.
The news comes only days after Discord named Tomasz Marcinkowski as its first chief financial officer – a move that was related to its plans of launching an initial public offering. The digital distribution platform highlighted in its recent financial report that it had about 140 million monthly users as of December 31st. It generated annual revenue of £94.32 million that represents an approximately 200% increase from the previous year.
Microsoft wants to expand its cloud platform
Microsoft is currently in the process of bringing active online communities under its umbrella to expand its cloud platform. In February, Financial Times said that the U.S. tech giant wanted to acquire Pinterest Inc.
Microsoft was also one of the bidders for TikTok last year, but lost to its rival Oracle Corporation. In September 2020, it bought ZeniMax Media for £5.44 billion in cash. ZeniMax Media is the parent company of Bethesda Softworks (videogame publisher).
In the last week of January, Microsoft said that its revenue jumped 17% in the fiscal second quarter. The Redmond-headquartered company performed largely upbeat in the stock market last year with an annual gain of more than 40%. At the time of writing, Microsoft is valued at £1.29 trillion and has a price to earnings ratio of 35.15.
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