Salesforce in Talks to Buy Slack

The hottest news in the stock market today is that Salesforce would be in talks to acquire Slack.

Many media outlets published the news, citing sources. The Wall Street Journal was the first to report it.

Slack’s shares jumped 37.6%, while Salesforce lost about 5%.

It’s not clear the potential deal’s value, but Slack’s market cap is now over $23 billion, and the cloud-based software company Salesforce, $224 billion. 

Salesforce stocks have more than doubled during the pandemic.

Slack debuted on Wall Street in June last year, through a direct listing, and in its first day of trading, it was valued at $23 billion, the same market cap it has now.

Slack is facing fierce competition from rivals like Microsoft Teams, Google Chat, and other apps. 

In October, Microsoft announced that Teams reached 115 million daily active users, up more than 50% since April. One year ago, in November 2019, it had 20 million.

Slack had about 12 million daily active users in October 2019, the last time it released this information. 

If both companies agree to the deal, it will probably be announced before December 9, when the working message app will report its quarterly earnings.

CNBC says Slack would be one of the biggest software deals ever for the industry. It would rank among IBM’s $34 billion purchase of Red Hat in 2019, Microsoft’s $27 billion purchase of LinkedIn in 2016, and Facebook’s $19 billion purchase of WhatsApp in 2014.

Salesforce has been making acquisitions in the last couple of years.

In 2019, it bought Tableau Software, which makes data analytics software, for about $16 billion. In 2018, it acquired Mulesoft, which provides integration software for connecting applications, for $6.5 billion.