Twitter offered Instagram CEO Kevin Systrom a $525 million deal to buy out the popular photo sharing service weeks in advance of Facebook’s $1 billion cash-and-stock offer, according to a report from The New York Times’ Nick Bilton.
Twitter’s proposed deal to buy Instagram occurred in March, the report claims, citing sources close to Twitter and Facebook. The social media giant offered $525 million in cash and shares and, according to the report, the deal was close to being finalized.
When Facebook offered the $1 billion deal to buy Instagram–which was later downgraded to a $715 million valuation after Facebook’s stock dropped–it came as a major surprise to Twitter executives, who expected the opportunity to make a counter offer, sources say.
The report contradicts claims made by Systrom when he testified to the California Corporations Department. When asked during the hearing whether or not Instagram had received any other offers prior to the Facebook deal, Systrom said, “We never received any formal offers or term sheets.”
The New York Times reports:
“Mr. Systrom and Mike Krieger, the other founder of Instagram, held several meetings as late as March with top Twitter executives, according to people on both sides of the talks, who requested anonymity because the talks were private and because they were concerned about legal repercussions.”
As Reuters points out in their report, there has been a considerable amount of tension between Twitter, Facebook, and Instagram following the deal. This month, Instagram shut off the ability for its photos to be displayed in Tweets. In response, Twitter rolled out an Instagram-like feature of its own.