Twitter's payroll (to say nothing of its stock-based compensation expense) is massively bloated. Slashing staff isn't a popular play for a strategic acquirer. Too much risk the bad will leaks to your core business.

This is a textbook private equity deal. Twitter's habit of ringing in the year with $500MM losses could be single-handedly cut with a 2/3rd staffing reduction (which costs lots in payroll and $800MM in stock-based compensation expense). How much of Twitter's $2bn in revenue would evaporate post-cuts. Over half? Still leaves $750MM of pre-tax income before R&D ($800MM in the FYE 2015). Cut that in half, say you lose a further 25% of revenues, and you still have $160MM before taxes yielding $100MM of net income. That's worth $1bn to $2.5bn.

If you can grow that to $500MM over 4 or 5 years, you could sell it for ~20x. Discount back at 10% or 20% and you have an optimistic valuation of $4 to $7bn.

Twitter's trading at $12bn. I suppose I'd bid $5.70 per share and be willing to entertain someone talking about $10 a share. I'd similarly be furious at the CEO of a company I own publicly speaking about buying the thing for twice that, as Benioff was.