Salesforce bets on big data with $15bn Tableau Software deal
Tableau has more than 86,000 customers, including heavyweights such as Verizon Communications and Netflix
Bengaluru — Salesforce.com agreed on Monday to buy big data firm Tableau Software for $15bn, adding muscle in its fight with Microsoft for a bigger share of the market that helps businesses target customers better.
The business of analysing data is fast becoming a battleground, with tech behemoths Alphabet’s Google and Amazon.com scaling up their presence in the market to take on established players like Microsoft and Tableau.
“The deal is transformative for the software industry, the most dramatic move yet by a cloud major to boost its analytics offerings,” Wedbush Securities analyst Steve Koenig said.
Salesforce’s customer relationship management software will benefit from using Tableau’s large data analytics in unravelling hidden patterns, unknown correlations, market trends and customer preferences.
Salesforce’s biggest deal ever comes days after Google bought big-data analytics company Looker for $2.6bn. It surpasses the $5.9bn that Salesforce paid to buy US software maker MuleSoft in 2018.
In 2016, Reuters had reported that Seattle-based Tableau was one of the companies in a leaked list of potential acquisition targets for Salesforce and that Tableau was working with an investment bank to explore a sale.
Tableau has more than 86,000 customers, including tech heavyweights such as Verizon Communications and Netflix.
“The acquisition accelerates Salesforce’s roadmap for their Customer 360 initiative, which helps companies gain a complete view of their customers, and more broadly their analytics initiative,” Koenig said.
As part of the all-stock deal, Tableau shareholders will get 1.103 Salesforce shares, valuing the offer at $177.88 per share, representing a premium of 42% to Tableau’s Friday closing price.
Shares of Tableau jumped 38% to touch a record high of $173.09, while those of Salesforce fell 4% in early trading.
The deal is expected to close in the third quarter, after which Tableau will operate independently, led by CEO Adam Selipsky and its leadership team.
The San Francisco-based company said the deal is likely to add up to $400m in its 2020 revenue, but would decrease adjusted profit by about 37c to 39c per share.
The company said it now expects 2020 adjusted profit in the range of $2.51 per share to $2.53 per share. Analysts were expecting $2.90 per share, according to IBES data from Refinitiv.
Bank of America Merrill Lynch was the financial adviser to Salesforce and Goldman Sachs advised Tableau.