By acquiring Slack, a business chat service with over 130,000 paid customers, Salesforce strengthens its portfolio of business applications and fills out its broader suite of software for new growth areas.So what’s the deal with Salesforce’s acquisition of Slack for a total of $27 Billion? In recent years, Salesforce, which began with the development of cloud-based sales reps software, has rapidly extended its scope and, along the way, has become one of the world’s most successful software firms, getting passed other giant software companies like Oracle, Cisco, SAP, Intel and IBM. The highest was the $34 billion purchase of Red Hat by IBM in 2018, followed by the $27 billion acquisition of LinkedIn by Microsoft in 2016. The acquisition is one of the biggest ever for the tech industry. IIM Udaipur is featured in the prestigious Financial Times Masters in Management 2020 Global Ranking at the 72nd Rank for its two year MBA program. Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.In December 2020, Salesforce announced it was acquiring Slack for more than $27 billion. Salesforce completes acquisition of Slack. “Considering the deal price and the presence of a robust competitor in the collaboration market in the form of Microsoft, we expect investors to be keyed in on the early success Salesforce has in driving Slack penetration within its existing customer accounts,” said Stifel analyst Tom Roderick who carries a “buy” rating with a US$295 price target for Salesforce stock. Salesforce, which published quarterly earnings on May 27, boosted its full-year outlook to an adjusted profit between US$3.79 and US$3.81 per share and forecast revenues in the range of US$25.90 billion and US$26.00 billion. Paid customer growth, the company stated, was up 39% to 169,000. Last month, Slack announced that its fiscal first quarter revenues rose 36% from last year to US$273.4 million, with billings rising 35% to US$278.5 million. Slack stated in a Securities and Exchange Commission filing that it expects the deal to close on July 21.
The DOJ’s Antitrust Division opened a “second request” review into the deal earlier this year as the new administration of President Joe Biden vowed to take a closer look at big tech mergers. Slack shares edged higher in active trading Monday, July 19, after an antitrust probe into its US$27.7 billion takeover by Salesforce was dropped by the Department of Justice (DOJ).
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