Salesforce is set to take ownership of the reigning workplace chat tool of the pandemic.
The software company announced today that it plans to acquire Slack, the 11-year-old collaboration software maker co-founded by Stewart Butterfield and Cal Henderson, in a cash and stock transaction worth $27.7 billion. The deal marks the largest purchase in Saleforce's history, and is among the top 10 biggest acquisitions in 2020--trumped by multibillion-dollar deals like S&P Global's $44 billion purchase of IHS Markit and AMD's $35 billion purchase of Xilinx.
Co-founder and CEO Marc Benioff said in a statement that the deal was a "match made in heaven," and stressed Slack's importance to the future of remote work. "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. I'm thrilled to welcome Slack to the Salesforce ohana once the transaction closes," wrote Benioff, using a term from Hawaiian culture that the company uses to refer to its internal support system.
Should the deal receive approval from shareholders, as well as the Federal Trade Commission and the U.S. Department of Justice, Slack's co-founders stand to gain handsomely. CEO Stewart Butterfield maintains an 8 percent stake in the company, and co-founder Cal Henderson owns a 3 percent stake. At a $27.7 billion valuation, that would make Butterfield's stake worth $2.2 billion and Henderson's stake worth $831 million.
The founders are also expected to stay on at the united company, which, according to a statement, will adopt Slack's interface for Salesforce's software. In other words, Salesforce will start to look more like Slack, instead of the other way around. Saleforce's current workplace chat tool, Chatter, allows users to message one another and share files, similar to Slack. But Chatter is only available to Salesforce users. Adopting Slack as Salesforce's interface could open it up to an even wider number of businesses.
While the exact details of the integration haven't been revealed yet, the company did disclose that both Slack and Salesforce users will have access to the other company's ecosystem of apps. Slack's platform integrates with more than 2,400 apps like Google Calendar or Zendesk, and companies choose which they prefer. Salesforce has a library of enterprise apps that can assist with everything from scheduling to creating graphics.
Slack would be aligned with Salesforce Customer 360, the customer relationship management (CRM) software used by sales and customer service teams in companies around the world. Currently, Salesforce Customer 360 is the most widely used CRM tool of its kind.
The transaction puts pressure on Microsoft, Salesforce's competitor, which has its own remote work chat tool, Microsoft Teams. Prior to Slack, Salesforce acquired two companies that also directly compete with Microsoft's products: Tableau, a data visualization platform, and MuleSoft, a back-end software program that connects data.
The transaction is expected to close at the end of Salesforce's second quarter in 2022, following the necessary approvals.