Stewart Butterfield (C), Slack’s co-founder and CEO, and Alan Shim (2nd L), Slack’s chief financial officer, the New York Stock Exchange (NYSE), ring the opening bell in New York on June 20, 2019. Faridabad
Drew Anger | Getty Images
Shares of Slack rose more than 24% on Wednesday after the Wall Street Journal reported that Salesforce negotiated to buy the company.
Salesforce’s stock fell nearly 4% on the news.
According to the report, the deal would likely be sluggish at a price in excess of the market cap before $ 17 billion.
Salesforce is in a takeover race, taking advantage of its market cap growth in recent years to grow. It acquired MuleSoft in 2018, the company’s biggest deal at the time to help connect cloud applications. The following year it spent more than twice the amount on the tableau, acquiring the data visualization company for $ 15.3 billion. Slack will be one of the largest software deals ever for the industry.
A deal is not guaranteed and can call through negotiations, the Wall Street Journal reported.
Shares of Microsoft, which competes with Slack through offering their teams, slightly dipped.
Microsoft already competes with Salesforce in software to track customers. Microsoft reportedly considers buying Salesforce but no deal was reached. Later, Microsoft launched the Team Communications app.
“Our primary competitor is currently Microsoft Corporation,” Slack said when he sought to become a public company in 2019. Microsoft has a large customer base that is capable of converting to teams, and can give Salesforce Slack a similar advantage.
This is a developing story. Please check back for updates.
Subscribe to CNBC on YouTube.