Update: Salesforce confirms Slack acquisition

Salesforce will acquire messaging platform Slack for US$27.7 million. The sales and marketing cloud software platform has confirmed the acquisition, with the news it has entered into a definitive agreement to buy the messaging platform. Slack will become the new interface for Salesforce Customer 360.

Salesforce said that combining Slack with Salesforce Customer 360 will create the operating system for the new way to work, creating a unified platform for connecting employees, customers and partners with each other and the apps they use every day, all within their existing workflows.

Slack has struggled to fully capitalise on the switch to remote working during the COVID-19 pandemic in the face of fierce competition from Microsoft Corp’s Teams and other workplace apps. Slack shares ended trading in the US on Tuesday, when news of the potential acquisition was first revealed, at US$29.57, well below the US$42 high they reached on their first day of trading last year.

The confirmation comes ahead of Slack's quarterly earnings reports due on 9 December. After The Wall Street Journal first reported that the two companies had held deal talks., Slack Technologies shares jumped 24 per cent to US$36.58, giving the company a market capitalisation of US$21 billion, while Salesforce fell 2.7 per cent

Slack’s app has been installed about 12.6 million times so far this year, up approximately 50 per cent from the same period in 2019, according to analytics firm, Sensor Tower. However, the economic fallout of the virus outbreak has forced Slack to give discount and payment concessions to many of its customers who have had to make cost cuts, the firm noted.

Salesforce annual revenue has improved against forecasts earlier in the year as the pandemic has boosted demand for its online business software that supports remote work and commerce. Salesforce spent more than US$16 billion last year in acquisitions to stay ahead of its main rivals, Oracle and SAP.

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