FILE PHOTO: Figurines with computers and smartphones are seen in front of Alphabet logo in this illustration taken, February 19, 2024. REUTERS/Dado Ruvic/Illustration/File Photo
(Reuters) -Google parent Alphabet decided not to pursue a takeover of online marketing software company HubSpot weeks ago, a person familiar with the matter said on Wednesday.
The talks between Alphabet and HubSpot never progressed to due diligence and fell apart shortly after the companies held initial discussions on a potential deal, the source said, on condition of anonymity to discuss confidential matters.
HubSpot's shares closed 12% lower on Wednesday, while Alphabet's shares were up 1.2%. Reuters had reported in April that Alphabet was in talks with advisers about the possibility of making an offer for HubSpot.
A deal for HubSpot, now valued at $25 billion, would have ranked as Alphabet's biggest ever and risked scrutiny from antitrust regulators. U.S. regulators have indicated growing aversion to large technology companies getting bigger through acquisitions.
HubSpot, which builds marketing software for small and medium-sized businesses, has specialized in so-called inbound marketing, where consumers start engagement with a brand. HubSpot customers apply its software to make advertising content that consumers can click on.
CEO Yamini Rangan said in May on HubSpot's financial results call that customer demand had weakened, as small businesses worried about the economic impact of high interest rates.
Bloomberg reported earlier that Google is no longer in talks to acquire HubSpot.
(Reporting by Jeffrey Dastin in San Francisco; Additional reporting by Harshita Mary Varghese; Editing by Shailesh Kuber, Alan Barona and Lisa Shumaker)
