Salesforce To Acquire Slack In $27.7 Billion Cash-And-Stock Deal, The Largest Ever In Cloud Computing Space

Business software company Salesforce.com will acquire work-chatting service Slack Technologies in a $27.7 billion cash-and-stock deal the largest ever in cloud computing space, The Wall Street Journal reported.

Founded by an ex-Oracle staffer Mark Benioff, Salesforce pioneered the model of delivering application software via the cloud through a subscription model by challenging the traditional approach of on-premise implementation which often involved costly upfront installation and lengthy implementation cycle.

With market capitalisation now at $230 billion, Salesforce has been among the big winners from disruption due to the Covid-19 pandemic. Salesforce‘s strong growth has been spurred by rising demand for its online business software that supports remote work and business.

In contrast, Slack has been struggling to fully capitalise on the switch to remote working during the pandemic as it faces fierce competition from Microsoft Corp's Teams and other workplace apps.

Salesforce’s acquisition fits well as part of its grand strategy to take on Microsoft. It is set to incorporate Slack as an unified front-end to access its business enterprise suite. Microsoft has positioned its Team as a gateway to its other business application offerings.

Salesforce has embarked on an aggressive acquisition strategy in recent years to boost its ability to battle Microsoft. It completed a $15 billion-plus takeover of data-analytics platform Tableau Software in 2019. It also acquired cloud-software provider Vlocity Inc.

Salesforce was also in negotiations to buy micro-blogging platform Twitter but abandoned the plan after resistance from its shareholders.