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Stewart Butterfield (C), co-founder and chief executive officer of Slack, and Allen Shim (2nd L), chief financial officer of Slack, ring the opening bell the New York Stock Exchange (NYSE), June 20, 2019 in New York City.
Drew Angerer | Getty Images
Shares of Slack rose more than 24% Wednesday following a Wall Street Journal report that Salesforce held talks to buy the company.
Salesforce stock dropped around 4% on the news.
The deal would likely value Slack at more than its market cap, prior to the report, of $17 billion, according to the report.
Salesforce has been on an acquisition spree, taking advantage of its market cap growth in recent years to buy growth. It acquired MuleSoft for $6.5 billion in 2018, the company’s biggest deal ever at the time, to help connect cloud applications. The following year it spent more than twice that amount on Tableau, acquiring the data visualization company for $15.3 billion. Slack would be one of the biggest software deals ever for the industry.
A deal is not guaranteed and the talks could call through, the Wall Street Journal reported.
Shares of Microsoft, which competes with Slack through its Teams offering, dipped slightly.
Microsoft already competes with Salesforce in software for tracking customers. Microsoft reportedly looked at buying Salesforce but no deal came about. Later, Microsoft launched the Teams communication app.
“Our primary competitor is currently Microsoft Corporation,” Slack said when it sought to become a public company in 2019. Microsoft has a large customer base it has been able to convert to Teams, and Salesforce could give Slack a similar benefit.
This is a developing story. Please check back for updates.
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