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Microsoft and Salesforce? Why an acquisition might just make sense

The report that Salesforce has been approached by a potential acquirer has stirred up a guessing sport within the tech business. Oracle, Microsoft, IBM and SAP are among the many firms whose names are being floated as the mystery suitor, though Oracle is reportedly not interested.

So what about Microsoft? At a excessive stage, a cope with Salesforce would make sense as a signature acquisition for Microsoft CEO Satya Nadella, permitting him to solidify Microsoft’s place in cloud computing, the place he’s already focusing a lot of the corporate’s consideration. In some methods, it makes way more sense for Microsoft than did the Nokia smartphone acquisition, which is a leftover of Steve Ballmer’s tenure on the firm.

It could additionally play to Microsoft’s conventional energy as an enterprise know-how supplier, additional distancing the corporate from rivals reminiscent of Apple and Google.

Though such a deal would have appeared nearly out of query a yr in the past, Microsoft and Salesforce have been working collectively extra carefully following their partnership announcement last May.

It’s not clear how the Salesforce CEO would slot in at Microsoft as an govt, if it got here to that, however Benioff and Nadella have proven indicators of a robust rapport.

On the conference call announcing their partnership, Benioff stated it had been “completely nice” working with Nadella. The Salesforce CEO additionally talked concerning the frequent visions of the businesses. “We each view our mission as serving to clients reach right now’s new world, a world of the cloud, a world of social computing, of cell computing, of connectivity,” Benioff stated on the time.

Neither firm is commenting on the experiences this week, however Bloomberg reports that Salesforce is working with monetary advisers to assist the corporate subject acquisition gives, after it was approached by the thriller firm.

Microsoft has the sources to drag off the deal, though an all-cash acquisition would take about half of the Redmond firm’s $95 billion money stability. Salesforce’s market worth is greater than $48 billion, with the San Francisco-based firm’s inventory climbing on the acquisition experiences.

It could simply qualify as the most important acquisition in Microsoft’s historical past, eclipsing the $8.5 billion Skype deal. It could even be one of the largest deals in tech history.

The back-end know-how integration could be a problem, however given Microsoft’s elevated deal with cross-platform compatibility and cloud computing, it’s rather more real looking than it could have been previously. From a branding perspective, Microsoft’s Dynamics CRM would most likely be mixed with Salesforce’s buyer relationship administration platform in a roundabout way.

The deal would additionally give Microsoft a much bigger presence within the Bay Space, past its current Silicon Valley workplaces, probably serving to recruiting efforts.

Backside line, there could be challenges, however at a excessive stage, a mixture of Microsoft and Salesforce wouldn’t be as loopy because it might appear at first.

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