Google Walks Away From Digg Deal

The Google/Digg acquisition negotiations were in full swing as of last Tuesday, had passed the term sheet stage and the two companies were in final negotiations in the $200 million range. But sometime this last week Google decided to walk from the deal. Digg was notified on late Thursday or Friday.

Google was in the due diligence stage of the deal, where they peer deep into Digg’s technology and financial statements. Most term sheets are non binding, so anything that gives the buyer pause can be used as an excuse to walk away – but generally the buyer already has a very good idea what they are getting well before the term sheet stage.

Two sources close to the companies suggested that some issue that came up during technical due diligence was to blame. One source said that the issue was more personality driven, and that Google decided after spending more time with Digg’s top team that there just wasn’t a fit.

Either way the deal appears to dead and can be added to the long list of failed Digg acquisition deals. And when a company is “left at the altar” other buyers are usually hesitant to step in.

Read one here!

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Published by Reinout te Brake

Reinout is a games investor and strategic business consultant specializing in the games industry. Reinout established his credentials through his own successful investments, start-ups, consulting and (advisory) board positions that led through time to strong bonds with key stakeholders in this fast paced industry. He is known for his outstanding results in the gaming industry. He has worked with many game studios around the globe and is therefore well known in the international gaming industry. Check out his games podcast; https://www.game-consultant.com

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