San Francisco, Dec 1, 2020 – Inc is buying workplace messaging app Slack Technologies Inc in a $27.7 billion deal, the biggest software deal in a year the COVID-19 pandemic has forced millions of professionals across the globe to work remotely.

The deal will bolster the enterprise portfolio of Salesforce, which now hopes to provide a unified platform for businesses to connect their employees, customers and partners with each other and the apps they use.

For Slack, the deal comes as it struggles to fully capitalize on the switch to remote working during the pandemic in the face of fierce competition from Microsoft Corp’s Teams and other workplace apps.

Slack shareholders will receive $26.79 in cash and 0.0776 shares of Salesforce common stock for each Slack share, or $45.5 per share based on Salesforce’s closing price on Tuesday.

The offer represents a premium of 54% since the first report emerged last week about the deal talks.

Slack shares fell marginally to $43.8 in extended trading on Tuesday, while Salesforce’s stock declined nearly 4%.

“(Salesforce) shares will likely be range-bound in the short term given the large transaction, but we are believers in the benefits of this deal to CRM and see shares recovering,” Barclays analyst Raimo Lenschow said.

Separately, Salesforce reported third-quarter revenue of $5.42 billion on Tuesday, beating analysts’ estimate of $5.25 billion, according to IBES data from Refinitiv.

Salesforce also said Chief Financial Officer Mark Hawkins would retire in January, and will be replaced by Chief Legal Officer Amy Weaver. – Reuters