On Tuesday, Recode, citing people familiar with the situation, reported that micro blogging site Twitter Inc. (NYSE: TWTR) has invested in SoundCloud. The report was confirmed by Twitter CEO Jack Dorsey.

Twitter has invested $70 million U.S. in SoundCloud. Interestingly, two years ago, TWTR had considered acquiring SoundCloud but then backed out of a deal. This time, TWTR has invested in Series E fund raising round of SoundCloud. On completion of the latest funding round, SoundCloud will have a value of $700 million U.S.. This is the same as the music streaming company’s valuation at the end of its Series D round of funding.

Jack Dorsey said that the investment in SoundCloud was made earlier in the year through Twitter ventures. Dorsey noted that SoundCloud has been a great partner of the company and their community-supported approach is similar to TWTR’s. The investment was also confirmed by a spokesperson from SoundCloud.

Twitter itself is now being seen as a takeover target. The takeover rumors have been fueled after Microsoft Corporation (NASDAQ: MSFT) announced the acquisition of professional networking site LinkedIn Corp. (NYSE: LNKD). The rumors have boosted TWTR shares in the last three trading sessions. The stock is up more than 13% since Monday.

Twitter shares closed Wednesday trading at $15.96 U.S., up 60 cents, or 3.9%, from Tuesday's close, witnin a 52-week trading range of $13.73 to $38.82 U.S.