After a 2 year wait, Salesforce officially owns Slack

Cloud computing titan Salesforce announced on Wednesday its completed acquisition of workplace chat platform Slack for $27.7 billion, adding the messaging app to its long list of enterprise software.

The deal began surfacing in 2019, commemorating one of the most significant acquisitions in the history of business software industries in recent years, resulting in Salesforce’s greatest purchase as of yet.

Since companies around the world began paving the way towards a digital way of connecting with their employees, customers, and partners; obtaining Slack will bring a different aspect to the software without changing its functionality, branding, or leadership.

This will transform the fast-rising startup into a major competitor to some of the biggest business communication platforms, with a market value close to $25 billion as of last year.

Both companies further announced that will join forces to provide users with Slack-first Customer 360. It will maximize work productivity by providing an effortless way to connect customers, employees, and partners with conversations, apps, and necessary data to power digital workflows in an innovative way to work together.

“Together we’ll define the future of enterprise software, creating the digital HQ that enables every organization to deliver customer and employee success from anywhere,” said Salesforce CEO Marc Benioff in a statement.

The deal, which was announced in December last year, stated that it will pay $27.7 billion for Slack, “under the terms of the agreement, Slack shareholders will receive $26.79 in cash and 0.0776 shares of Salesforce common stock for each Slack share, representing an enterprise value of approximately $27.7 billion based on the closing price of Salesforce’s common stock on November 30, 2020.”

It is crucial to highlight that the fast-paced rise of the start-up company attracted attention from giants such as Microsoft.

Since its soar to the scene, Slack transformed itself from a startup – originally created as a gaming company in 2009 – to a key opponent of Microsoft and Facebook with more than 12 million daily active users.

While Slack witnessed a rise in its userbase, it did not have a clear path as to how it will become profitable and could not implement a strong approach to defeat the increasing pressure from Microsoft Teams, which paved the way to a potential acquisition with each passing quarter.

Salesforce, one of Microsoft’s biggest competitors in the cloud sector, has become one of the most dominant software companies thanks to its customer relationship management software that assists businesses in overseeing sales online.

“The only advantage Microsoft has is distribution, and so now they’ve neutralized the advantage. They can actually fulfill the ultimate promise of the opportunity because they have 10 times the amount of salespeople that can go distribute this thing into corporations around the world,” said Box CEO Aaron Levie after the deal was announced.

Salesforce addressed its employees as architects of a remote-friendly approach, and with Slack in its pocket it will finally have the long-awaited capacity to dominate the field as other companies push themselves in that direction.

During the COVID-19 pandemic, both companies became a crucial element in the remote working field, as several institutions worldwide switched to a more remote approach and moved a sizeable amount of their businesses online.

While Salesforce’s market witnessed a rise in value during the COVID-19 expansion, Slack was not blessed with the same result as it experienced a rollercoaster of ups and downs in its stock price.

Now that the cloud computing titan finally owns Slack, this will give both software companies the opportunity to compete with some of the biggest brands such Microsoft, Oracle, and other cloud enterprise companies.