Salesforce cloud software company is negotiating the purchase of Slack, the workplace messaging app that would be one of the largest software transactions to date, according to people skilled in the matter.
The announcement could be made early next week, a person close to the store said.
Marc Benioff, founder and CEO of Salesforce, has been researching the acquisitions for some time and has looked at several targets, another person who was briefed on the case said.
Shack shares rose 22 percent after The Wall Street Journal first reported that the two companies had negotiated the deal, giving the company a market value of over $ 20 billion. Salesforce fell about 3 percent to the news.
Salesforce was among the big winners in the coronavirus epidemic due to soaring cloud software releases. In contrast, Slack – an app that employees collaborate with and access other cloud apps – couldn’t catch this year’s “work from home” wave, leaving its shares behind rivals in the red hot cloud software sector.
The acquisition would reinforce Mr. Benioff’s efforts to challenge Microsoft to become a leading cloud software provider for office workers, making Slack a “interface” for Salesforce users to leverage the company’s applications, including core customer relationship management. service as well.
Microsoft’s teams, built as Slack’s competitors, have become windows to other applications in the software group, including CRM software, potentially paving the way for salesforce expansion.
Shares of Salesforce have more than doubled since the pandemic hit the U.S. in early March, forcing many office workers to work from home and digitizing businesses.
Shack shares, which went public on Wall Street last year, fell short of disappointing two-quarter gains. Prior to the news of negotiations with Salesforce, they traded 23 percent below the closing price on the first trading day last year, despite a 78 percent increase in the cloud software sector this year.
Stewart Butterfield, co-founder and CEO of Slack, will have a major say in the outcome of the negotiations. Under the special class of supervisory shares, Slack controls in person about 42 percent of its votes, thanks to its stake in the company and voting agreements with other investors.
Salesforce has gained a lot in recent years. Tableau Software, a maker of data analysis software, was acquired for about $ 16 billion in 2019, and a year earlier, the company took over network software maker Mulesoft for $ 6.5 billion.
However, in August this year, Mr. Benioff indicated that the high valuation of software companies makes it difficult for companies to do business. “For a company like Salesforce, we don’t really see an M&A environment,” he said in a call to analysts.
A significant portion of Slack’s takeover bid is likely to be in equities, as Mr. Benioff wants to use Salesforce’s own rich market valuation as a currency to conduct the deal, the person informed of the case said.
Another account by Miles Kruppa in San Francisco