Google parent company Alphabet is putting its acquisition of HubSpot on hold as HubSpot shares suffer their biggest decline since 2020.

Jul 11, 2024 11:58:00 AM

Alphabet is reportedly accelerating its efforts to acquire the online marketing software maker HubSpot but it was revealed that the effort had been temporarily put on hold. The report prompted the biggest drop in HubSpot’s stock price since 2020.

Alphabet Drops Its Interest in HubSpot (GOOGL, HUBS) – Bloomberg
https://www.bloomberg.com/news/articles/2024-07-10/google-parent-alphabet-is-said-to-shelve-its-interest-in-hubspot

Google Stock: HubSpot Falls as Alphabet Walks | Investor’s Business Daily
https://www.investors.com/news/technology/google-stock-hubs-stock-acquisition-talks/

Google parent company Alphabet pulled out of HubSpot deal weeks ago, source says | Reuters
https://www.reuters.com/technology/google-parent-alphabet-shelves-interest-hubspot-bloomberg-news-reports-2024-07-10/

HubSpot shares fall 12% on reports that Alphabet is withdrawing shares
https://www.cnbc.com/2024/07/10/hubspot-shares-drowning-about-16-percent-in-the-report-that-the-alphabet-is-falling-interest.html

HubSpot is a company that provides marketing software to companies with about 2,000 employees. The company went public in 2014 and has revenue of $2.2 billion (about 360 billion yen) in 2023. Investors expecting growth have driven up the stock price by about 50% in 12 months, and the market capitalization as of April 2024 has been calculated at $35 billion (about 5.7 trillion yen).

In April 2024, it was reported that Alphabet was considering acquiring HubSpot. If the acquisition is successful, it would help Google close the gap with competitors Microsoft and Amazon in the fast-growing customer relationship management ( CRM ) software market.

Google parent Alphabet is considering acquiring marketing tool HubSpot in what would be its biggest acquisition to date – GIGAZINE

However, Bloomberg has learned from sources that Alphabet has put its plans to acquire HubSpot on hold, making it clear that one of the company’s biggest acquisitions will not happen in 2024. The news sent HubSpot’s stock price down 21%, its biggest drop since 2020. This boosted HubSpot’s market capitalization to about $25 billion (about 4 trillion yen).

Alphabet and HubSpot have not yet reached the detailed stage Due Diligence discussions, according to people familiar with the matter. Both Alphabet and HubSpot declined to respond to Bloomberg’s requests for comment.

According to Bloomberg, if Alphabet’s acquisition of HubSpot were to go through, it would be the largest acquisition in the tech industry in 2024. At the time of this writing, the largest acquisition in the tech industry in 2024 was acquisition ANSYS by Synopsys, the largest EDA semiconductor company, announced in January 2024. The acquisition price was $34 billion (about 5.5 trillion yen).

Alphabet’s acquisition of HubSpot has also been imperiled by antitrust scrutiny: The Justice Department and Federal Trade Commission have actively opposed major acquisitions in recent years, forcing big tech companies to rethink their plans to grow through acquisitions.