It's time everyone understood a fundamental precept of startup acquisition rumors: If an acquisition price is leaked before the deal is completed, the acquiree

It's time everyone understood a fundamental precept of startup acquisition rumors: If an acquisition price is leaked before the deal is completed, the acquiree has no intention of selling. In a private acquisition, there are only two parties in a position to leak: the acquirer and the acquiree. The acquirer, which has shareholders, competitors, and lots of money, has no incentive to leak the price on the table, or even the fact that there is a table. It gives away too much information to competitors and creates an unwanted news cycle. So in fact they'll be pissed if information about the negotiation is leaked. If the acquiree actually wants to do a deal, they don't want to piss off the potential acquirer, so they'll keep their mouths shut. But they might have plenty of reasons to leak the negotation price, particularly if they're a company that is losing money and wants to inflate the company's valuation before another round of private financing. Going before investors saying "We turned down a billion dollars from Google, maybe you heard about it" creates a nice focal point for the ensuing discussion about the company's valuation. Negotiating in bad faith like this happens all the time, most famously with Facebook/Yahoo! (2006) and Groupon/Google (2010). So the next time you read another news story about an acquisition rumor that includes a price tag, ignore it, because the story's not for you; it's for a future investor. (Note that the foregoing logic does not apply if the acquiree is publicly traded, because the deal must be approved by shareholders, so the acquisition price is always "leaked" before the papers are signed.)