Microsoft in Talks for $10 Billion Takeover of Discord
American multinational technology company, Microsoft Corporation is in talks to take over VoIP, instant messaging platform, Discord in a deal that could be worth $10 billion. Per the reports, first revealed by Bloomberg citing people familiar with the matter, the video-game chat outfit is also in talks with other potential buyers, but no deal is imminent yet.
VentureBeat broke a report on Monday Discord is considering a $10 billion sales offer after more than one buyer showed interest. The VentureBeat report noted that the discussions had been narrowed to one potential investor, but one of the Bloomberg sources noted that Discord may not eventually be acquired as it may rather explore a public listing option.
Discord, a platform that came into the limelight in 2015 as a hub for gamers to communicate by video, voice chats, or text has grown its position in the past year as the coronavirus pandemic forced people to explore innovative ways to maintain social communications. Thanks to the COVID-19 lockdowns, the Discord platform was quickly adopted for holding online classes, community discussions, and dance rehearsals amongst others.
As a gaming-centric platform, the acquisition of Discord “would be a natural fit” with Microsoft’s Xbox video gaming business according to Joost van Dreunen, a New York University professor who studies the business of video games.
Besides Dreunen, other analysts have seen the potential interest from Microsoft per the Discord takeover as a strategic one.
The deal will also be an easy one for Microsoft per financials as the tech giant boasts of about $131 billion in total cash as of Dec. 31. Discord is valued at $7 billion after a December $100 million funding round. The company has about 140 million monthly active users and it generated $130 million in revenue last year per a report from The Verge.