8-KMaterial AgreementsExhibits & Filings

Salesforce, Inc. 8-K Report, Material Agreement (Dec 1, 2020)

Filed December 1, 2020For Securities:CRM

Summary

Salesforce, Inc. (CRM) announced on December 1, 2020, a significant definitive agreement to acquire Slack Technologies, Inc. This acquisition will be structured as a merger, where Slack will become a wholly-owned subsidiary of Salesforce. The transaction is an all-stock deal with a cash component, valuing Slack at a specific exchange ratio of 0.0776 Salesforce shares and $26.79 in cash for each Slack share. This strategic move aims to enhance Salesforce's Customer 360 platform by integrating Slack's communication and collaboration capabilities, potentially driving significant revenue synergies and expanding its enterprise software dominance. The deal is subject to customary closing conditions, including regulatory approvals and shareholder votes, with an expected completion by August 2021, though extensions are possible. The financing for the cash portion involves both existing cash reserves and a new $10.0 billion bridge loan facility.

Key Highlights

  • 1Salesforce to acquire Slack Technologies, Inc. in a stock and cash merger.
  • 2The transaction values Slack at 0.0776 shares of Salesforce common stock and $26.79 in cash per Slack share.
  • 3The acquisition aims to integrate Slack's collaboration tools into Salesforce's Customer 360 platform.
  • 4The deal is subject to customary closing conditions, including regulatory and shareholder approvals.
  • 5The transaction is expected to close by August 1, 2021, with potential for extensions.
  • 6Salesforce has secured a $10.0 billion bridge loan facility to finance the cash portion of the acquisition.
  • 7Key Slack stockholders representing approximately 55% of voting power have entered into a Voting and Support Agreement to approve the merger.

Frequently Asked Questions

Salesforce aims to integrate Slack's leading communication and collaboration capabilities into its Customer 360 platform. This integration is expected to create a more unified and powerful customer relationship management (CRM) ecosystem, enhance customer engagement, and drive significant revenue synergies by cross-selling and up-selling opportunities.

Slack shareholders will receive a combination of Salesforce common stock and cash for each share of Slack they own. Specifically, the merger consideration is 0.0776 shares of Salesforce common stock and $26.79 in cash per Slack share. Certain equity awards will also be addressed according to the terms of the merger agreement.

The completion of the merger is contingent upon several conditions, including: approval by Slack's shareholders, listing of the Salesforce shares to be issued, effectiveness of a registration statement on Form S-4 filed by Salesforce, accuracy of representations and warranties, compliance with covenants, absence of any legal prohibitions (including antitrust approvals under the Hart-Scott-Rodino Act and other specified laws), receipt of tax opinions, and the absence of a material adverse effect on Slack.

Salesforce plans to finance the cash component of the merger consideration through a combination of cash on its balance sheet and new debt. The company has secured a commitment for a $10.0 billion, 364-day senior unsecured bridge loan facility from a syndicate of banks to support the transaction.