For $28 billion, the popular corporate messenger, Slack, sold

For around $28 billion, Salesforce is acquiring corporate messenger Slack. According to the makers of Slack, Microsoft plans to kill the app, taking advantage of its competitive role in the global industry. The agreement will further boost Slack’s position in the messaging sector and enhance competition between Microsoft and its messenger teams.

10:12 GMT, Wednesday, December 2, 2020

Slack was selling out
Salesforce announced the acquisition of a direct rival to Microsoft Teams, Slack, a business messenger. The contract, amounting to $27.7 billion, will be finalized in the second quarter of fiscal 2022. For instance, Facebook gave WhatsApp $19 billion in February 2014.

Salesforce is an American developer of apps. Before the company purchased the maker of the simulation and data processing tool Tableau, paying $ 15.7 billion for it and the company MuleSoft, which produces integration tools, cost it $ 6.5 billion, the acquisition of Slack is the biggest in its entire history.

Since 1999, Salesforce itself has existed. Its key product is the eponymous CRM system, which the SaaS (Software as Service model delivers to consumers. The list of businesses owned by Salesforce may also be on Twitter – the parties discussed the prospect of a merger in 2016, but the social network’s shareholders rejected it.

Conditions of the deal
The parties decided that $ 26.79 billion in cash and 0.0776 Salesforce common stock for each Slack share would be issued by the Slack messenger owners. Slack would turn into a separate business into a Salesforce operating division after all the terms of the contract are fulfilled, although no significant staffing changes are expected. Slack designer Stewart Butterfield (Stewart Butterfield), who is currently the post-Slack director general, will hold his role in particular.

Butterfield himself was able to assure everyone that a free and autonomous forum would remain for the Slack messenger. On his Twitter, he announced this, adding that the contract with Salesforce is a reason for the business’s growth.
At the end of November 2020, Slack’s intentions to become Salesforce’s property became public for the first time. The Wall Street Journal estimated that corporate messenger stock grew in price by 25 percent and the company’s market cap by $17 billion to nearly $20 billion shortly after the emergence of this results.
7 Years in History

Slack was introduced by Stuart Butterfield in August 2013 and is short for All Conversation and Information Searchable Log, which translates as Searchable Conversation and Data Log. Slack has all the capabilities of modern instant messengers, including allowing team members to connect directly with each other on networks, in private communities, and to check for discussion information.

Google Drive, Trello, Dropbox, Box, Heroku, IBM Bluemix, Crashlytics, GitHub, Runscope, and Zendesk can be combined with Slack. The roles of voice and video calls were introduced to the messenger in March 2016.

The company’s sales increased by 49 percent year-on-year to $215.9 million, according to the results of the second quarter of fiscal 2021, which ended for Slack on July 31, 2020, while minimizing losses from $359.6 million in the same period last fiscal year to $73 million The company has announced a 30 percent growth in the number of paying customers year-on-year – from 130 thousand.

Microsoft Rivalry

According to CNBC experts, one of the implications of the contract between Slack and Salesforce is the improvement of the role of the messenger in the rivalry with Microsoft Teams. In November 2016, three years after the arrival of Slack, the tech giant released its own corporate messenger.

Microsoft agreed to improve Teams’ position in the enterprise messenger market in July 2018, as reported by undercode, and released its fully free version open to all. Up to then only Office 365 subscribers, also known as Microsoft 365, have been able to use Teams. Opening teams for free to a broader audience is seen by business media as another step in comparison with Slack, which since its introduction has delivered a free edition.

Unit pressure on Slack intensified in subsequent years, and its developers were unable to tolerate it in July 2020, appealing to the authorities for assistance. They lodged a lawsuit with the European Commission against Microsoft in which they called out the corporation’s non-competitive conduct.

The founders of Slack accused it of exploiting its dominant role to disperse teams, including through Office, and indicated that Slack would be killed by Microsoft. Microsoft reacted by saying that with more services embedded into teams, it has managed to break out of the lead.

By the end of March 2020, the number of regular active Slack users worldwide had reached 12.5 million, according to figures from the developers themselves, while there were around 10 million at the beginning of March 2020. For comparison, there were around 75 million teams at the time.