CRM giant Salesforce signed a definitive agreement to buy messaging platform Slack Technologies Inc. in a deal of $27.7 billion.
The agreement shows how major cloud computing players are rushing to add muscle to the pandemic's remote-working boom. Launched back in the year 2013, Slack is a popular workplace communication software for tech companies, media and retailers — used by Amazon, IBM, TD Ameritrade and others, including CNN.
Salesforce reported third-quarter revenues of $5.42 billion on Tuesday, an increase of 20% over the same period last year, and diluted earnings per share of $1.15. At the beginning of 2020, slack had lost about 40% of its value since it was made public. Consider that after its last profit report, the company lost 16% of its value, and before the escape of the Salesforce affair.
The company confirmed that it would acquire Slack WORK, with shareholders receiving $26.79 in cash and 0.0776 common shares of Salesforce for each Slack share, for a total of $45.86 per share.
Salesforce CEO Marc Benioff said in a statement “The plan is to combine Slack with Salesforce Customer 360. On the whole, our transactions have been extremely successful”.
While Slack’s CEO and Co-founder Stewart Butterfield quoted, “As software plays a more and more critical role in the performance of every organization, we share a vision of reduced complexity, increased power and flexibility, and ultimately a greater degree of alignment and organizational agility. Personally, I believe this is the most strategic combination in the history of software, and I can’t wait to get going.”
Slack, which is free for users of the basic version, has been quickly adopted into the technology industry for its ease of use and the promotion of a more casual way of talking than email.
In 2019, Salesforce also acquired data analytics firm Tableau Software for $15.7 billion, to help companies better visualize their data.