Alphabet Walks Away From HubSpot Deal

Google parent Alphabet reportedly opts not to pursue a takeover of HubSpot, amid increased regulator scrutiny of tech acquisitions on antitrust grounds.

It was back in April this year when reports emerged that Alphabet was eyeing a possible acquisition of HubSpot, in order to bolster its own to bolster CRM and cloud position.

It was reported at the time that Alphabet had been talking to its advisers about the possibility of making an offer for HubSpot, an online marketing software provider with a market value of $25 billion.

No acquisition

HubSpot provides marketing software to companies that typically have up to 2,000 employees, and has been publicly listed since 2014.

A deal for HubSpot would have potentially expand Google’s offerings in the growing customer relationship management (CRM) software market.

The deal would also enable Alphabet to tap a wider base of enterprise customers who spend on marketing and advertising.

Likewise there could a cloud computing business benefit for Google, as it seeks to close the gap against market leaders AWS and Microsoft.

But now Reuters, citing a person familiar with the matter, reported that Alphabet weeks ago decided not to pursue a takeover of HubSpot.

If the deal had gone ahead it could have been Alphabet’s largest ever purchase.

The talks between Alphabet and HubSpot reportedly never progressed to due diligence and fell apart shortly after the companies held initial discussions on a potential deal, the source told Reuters.

Antitrust issue?

If Alphabet had made a move for HubSpot, it would have likely triggered some form of regulatory eyeballing, as governments and antitrust watchdogs in major locations such as the US, UK and Europe, adopt an increasingly sceptical tone about tech acquisitions.

Google may be able to argue that the acquisition would bolster competition in the marketing and sales software sector, and would pose a genuine challenge to the domination of Salesforce and Microsoft for example.

Google however is already facing a number of antitrust challenges on both sides of the Atlantic, including a landmark US lawsuit accusing it of abusing its position as online search leader.