BY Richard Summerfield
Salesforce has agreed to acquire Slack Technologies in a deal worth $27.7bn. Under the terms of the agreement, Slack shareholders will receive $26.79 in cash and 0.0776 shares of Salesforce common stock for each Slack share held. That is $45.50 per share, based on Salesforce’s closing price on Tuesday - a premium of 54 percent since news of negotiations between the companies emerged last week.
The board of directors of both companies have approved the deal and the Slack board recommends that Slack stockholders approve the transaction and adopt the merger agreement. The transaction is expected to close in the second quarter of Salesforce’s fiscal year 2022, subject to approval by Slack stockholders, the receipt of required regulatory approvals and other customary closing conditions.
“This is a match made in heaven,” said Marc Benioff, co-founder and chief executive of Salesforce. “Together, Salesforce and Slack will shape the future of enterprise software and transform the way everyone works in the all-digital, work-from-anywhere world.”
“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,” said Stewart Butterfield, chief executive of Slack. “Personally, I believe this is the most strategic combination in the history of software, and I can’t wait to get going.”
Slack has seen a near-doubling of its market value in 2020 as the COVID-19 pandemic has seen offices close and remote working come to the fore. However, at the start of the year, Slack had lost around 40 percent of its value since it went public. Equally, according to its most recent earnings report, the company lost 16 percent of its value. Slack also recorded net losses of $147.6m during two quarters of 2020.
The deal is expected to help Salesforce tackle the market dominance of Microsoft, which has seen a significant surge in the number of people utilising its business applications during the coronavirus crisis.
News: Salesforce acquires Slack for over $27 billion, marking cloud software vendor’s largest deal ever