Slack shares skyrocket following report of possible Salesforce acquisition

Stewart Butterfield (C), co-founder and CEO of Slack, and Allen Shim (2nd L), CFO of Slack, ring the opening bell on the New York Stock Exchange (NYSE) on June 20, 2019 in New York York City.

Drew Angerer | Getty Images

Slack shares rose more than 24% on Wednesday following a Wall Street Journal report that Salesforce held talks to buy the company.

Salesforce shares fell about 4% on news.

The deal would likely value Slack at more than its pre-report market cap of $ 17 billion, according to the report.

Salesforce has been on a frenzy of acquisitions, taking advantage of the growth in its market capitalization in recent years to buy growth. It acquired MuleSoft for $ 6.5 billion in 2018, the company’s biggest deal at the time, to help connect cloud applications. The following year, he spent more than double that amount on Tableau, acquiring the data visualization company for $ 15.3 billion. Slack is said to be one of the biggest software deals ever in the industry.

A deal is not guaranteed and talks could be successful, the Wall Street Journal reported.

Shares of Microsoft, which competes with Slack through its Teams offering, also fell slightly in the report.

Microsoft already competes with Salesforce in customer tracking software. Microsoft has reportedly considered buying Salesforce, but no deal has been reached. Microsoft later launched the Teams communication app.

“Our main competitor right now is Microsoft Corporation,” Slack said when it sought to become a public company in 2019. Microsoft has a large customer base that it was able to convert to Teams, and Salesforce could offer Slack a similar benefit.

Spokespersons for Salesforce and Slack were not immediately available for comment.

– CNBC’s Ari Levy and Jordan Novet contributed to this report.

This is a developing story. Please come back for updates.

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