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Salesforce confirms Slack takeover

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(Image credit: Image Credit: Salesforce)

Salesforce has confirmed it will acquire communications and collaboration platform Slack in a deal worth $27.7 billion.

In a press release, the firm explained that Slack shareholders will receive $26.79 in cash and 0.0776 shares of Salesforce common stock for each Slack share.

The deal will be funded with cash on Salesforce’s balance sheet, paired with new debt. The company said it obtained a commitment from Citigroup Global Markets Inc., Bank of America, N.A. and JPMorgan Chase Bank, N.A. for a $10.0 billion senior unsecured 364-day bridge loan facility.

Salesforce says it aims to combine Slack with Salesforce Customer 360 in order to transform the industry and the way its customers work.

“This is a match made in heaven,” said Marc Benioff, Chair and CEO at Salesforce. “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.”

Both boards have approved the transaction, with the Slack board recommending the company’s stakeholders give the process the green light and adopt the merger agreement. If all goes according to plan, the deal should be sealed in Q2 2022.

Certain Slack common stock holders agreed to vote all of their Slack shares in favor of the transaction, it was also said. The Slack shares subject to the agreement represent approximately 55 percent of the current outstanding voting power of the Slack common stock.

When the news of a potential acquisition first broke, speculation suggested both companies were interested in the move because of the huge opportunity provided by cross-selling.

Describing Slack as a “new interface for Salesforce Customer 360”, Salesforce says communications tool will be “deeply integrated” into every Salesforce Cloud.

“As the new interface for Salesforce Customer 360, Slack will transform how people communicate, collaborate and take action on customer information across Salesforce as well as information from all of their other business apps and systems to be more productive, make smarter, faster decisions and create connected customer experiences.”

At the other end, Slack will get the opportunity to “expand its presence in the enterprise”.