Salesforce closes $27.7bn acquisition of Slack

Merger creates stronger rival to Microsoft's Teams app

The logo of the Slack Technologies Inc. is seen outside the New York Stock Exchange (NYSE) after their company  public offering (IPO) on June 20, 2019 located at Wall Street in New York City. Software company Slack Technologies climbed on the New York Stock Exchange Thursday after debuting in a direct listing, in the latest sign of Wall Street's appetite for new technology entrants.Shares of the company, whose arrival was marked with a giant purple banner outside the NYSE, initially surged as high as $42 before pulling back somewhat and finishing at $38.62. The exchange had set a reference price of $26.
 / AFP / Johannes EISELE

Cloud computing company Salesforce has completed its acquisition of Slack Technologies for $27.7 billion, nearly eight months after first announcing its plans to acquire the messaging app.

US antitrust regulators cleared the deal this week. As part of the agreement, Slack will be positioned to “accelerate and extend its mission to make work life simpler, more pleasant and more productive”, Salesforce and Slack said in a joint statement on Wednesday.

“We couldn’t be more excited to have Slack as part of the Salesforce family,” Marc Benioff, chief executive of Salesforce, said.

“Together, we will define the future of enterprise software, creating the digital HQ that enables every organisation to deliver customer and employee success from anywhere."

In December, the San Francisco-based Salesforce agreed to buy Slack for $27.7bn in cash and stock. Under the deal, Slack investors would receive $26.78 for each company share as well as a 0.0776 share of Salesforce.

The companies aim to offer solutions that let businesses use a single platform for connecting employees, customers and partners with each other and the apps they use every day – all within their existing workflows, they said.

“Salesforce and Slack are uniquely positioned to lead this historic shift to a digital-first world,” Stewart Butterfield, Slack co-founder and chief executive, said.

“I could not be more excited for what’s to come … we have a once-in-a-generation opportunity to rethink and reshape how and where we work."

Slack, which ensures a seamless communications flow across various channels, is used by millions of people and businesses around the world. As organisations transitioned to the pandemic-led remote or hybrid mode of working, the messaging app helped them to work more efficiently and effortlessly.

The merger has created a stronger rival to workplace software maker Microsoft, whose Teams app competes with Slack. A Slack platform can potentially replace the need for emails, phone calls and video conferences.

“Salesforce and Slack coming together will help us become more connected, more productive and more innovative so we can better serve our clients,” Arvind Krishna, chairman and chief executive of IBM, said.

IBM’s 380,000 employees are using Slack, with numerous workflows across Salesforce’s cloud platforms in different time zones.

“Salesforce will create a modern workspace that enables collaboration, communities, communications, customer experience and AI [artificial intelligence] in an ecosystem that will welcome other integrations to extend enterprise functionality,” Wayne Kurtzman, research director at International Data Corporation, said.

Updated: July 22nd 2021, 1:47 PM
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