Given the risks of the deal and Salesforce’s valuation of over $200 billion, analysts have suggested that their investors root for an antitrust review to prevent the deal. Further, if Salesforce were to affect Slack’s internal operations through the acquisition, some existing customers may be turned away, as many customers now enjoy Slack for their simplicity and neutrality. Together, Salesforce and Slack will deliver the Slack-first Customer 360 that gives companies a single source of truth for their business, and a single platform for connecting employees. This is concerning for Salesforce, who would be giving up nearly 13% of their market value for the acquisition based on Slack’s EV/Sales multiple seen in Figure 2. Since Slack is a SaaS valued at multiples of revenue instead of profits, their growth forecast faces immense pressure on its ability to materialize as earnings. SAN FRANCISCO Salesforce said on Tuesday that it would buy the workplace software company Slack for 27.7 billion in cash and stock, the latest in a wave of deals as the coronavirus pandemic. Founded in 1999, Salesforce enables companies of every size and industry to take advantage of powerful technologies cloud, mobile, social, voice, and artificial intelligence to connect to their customers in a whole new way. They have not turned a profit since their initial public offering last year. Furthermore, Slack’s growth should be a risk for Salesforce. Together, Salesforce and Slack will deliver the Slack-first Customer 360 that gives companies a single source of truth for their business, and a single platform for connecting employees, customers, and partners with each other and the apps they use every day, all within their existing workflows. A much better suited one could argue could be Google or Amazon as they could integrate Slack into their platforms, but that would be unlikely due to antitrust regulations. On the other hand, Slack could be a distraction for Salesforce management and could therefore not be believed to be the best owner for Slack.
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