Investment bank JP Morgan is in talks to acquire a 10pc stake in social networking site Twitter for US$450m. The move values Twitter at US$4.5bn.
The fund intends to buy its share in Twitter through direct deals with existing shareholders and investors and not on the secondary market.
JP Morgan’s Digital Growth Fund was established in the past month and has raised US$1.2bn so far, not far off its US$1.3bn target.
JP Morgan Digital Growth Fund
The fund will have a maximum of 480 investors and will split its investment in three directions
Following the Twitter investment, the fund is also targeting investments in either Zynga or Skype.
A final third of the fund will be committed to six rapidly growing technology players.
Twitter received a US$200m investment from Kleiner Perkins in December that valued it at US$3.7bn.
Twitter has about 253m users and is expected to reach revenues of US$150m this year.