Weeks before he accepted a$1 billion offer from Facebook, Instagram CEO KevinSystrom had verbally agreed to sell his photo-sharing company toTwitter Inc for $525 million in March - but then called off thedeal, according to a New York Times report citing unnamedsources.
Facebook CEO Mark Zuckerberg ultimately acquired Instagramafter pushing through a cash-and-stock deal just weeks beforeFacebook's May initial public offering. The transaction closedin September at a $715 million valuation, reflecting Facebook'sstock drop since the offering.
During negotiations with Instagram, Twitter executives hadhanded Systrom a term sheet outlining the details of theproposed deal, the Times reported, but Systrom later toldCalifornia state regulators under oath that his company had notreceived any "formal offers or term sheets" from potentialbuyers aside from Facebook.
Relations between Twitter, Instagram and Facebook havesoured since Facebook successfully swooped for the photoservice. Earlier this month Instagram shut off a functionalitythat allowed Twitter to display Instagram pictures, whileTwitter introduced its own photo color-filters to compete withInstagram.
A spokeswoman for Facebook declined comment. Twitter couldnot be immediately reached for comment.