According to Reuters, Salesforce.com Inc will acquire workplace app Slack Technologies Inc for $27.7 billion, the biggest deal of could-computing pioneer on remote working and sharpening its rivalry with Microsoft.
This deal enables Salesforce in providing a unified platform for businesses to connect their employees, customers, and partners with each other and the apps they use. Due to the COVID-19 pandemic, Slack struggles to fully capitalize on the switch to remote working.
Slack revolutionize workplace communication by focusing on real-time messaging and group conversations. However, Slack now faces strong competitive space from larger, older giants like Microsoft Corp. Microsoft Corp is aggressively promoting its similar teams’ product with integrated video and voice calling.
Rishi Jaluria, DA Davidson analyst said, “The deal allows Salesforce to get deeper into collaboration and business communication and it’s good for Slack, especially to grow their penetration into non-tech companies.”
Slack shareholders will receive $26.79 in cash and 0.0776 shares of Salesforce common stock for each Slack share, or $45.5 per share based on Salesforce’s closing price on Tuesday.
Slacks shares fell slightly to $43.73 in extended trading on Tuesday and its stock declined above 4%.
Raimo Lenschow, Barclays analyst said, “Salesforce share will likely be range-bound in the short term given the large transaction, but we are believers in the benefits of this deal to CRM and see shares recovering.”
Salesforce’s Chief Financial Officer Mark Hawkins would retire in January and would be replaced by Amy Weaver, Chief Legal Officer.
