Microsoft's Salesforce.com acquisition falls through due to price disagreements

CNBC today reported that Microsoft was engaged in "significant" talks this spring regarding acquisition of Salesforce.com, the largest cloud-based CRM solutions company. According to sources familiar with the talks, Microsoft had offered somewhere in the neighborhood of $55 billion for the company broken down into a cash offering along with a stock trade and position offering to Marc Benioff, Salesforce.com's CEO.

The buyout, had it gone through, would have been the largest software company sale in history. According to sources familiar with the talks, Marc Benioff kept raising the price and at point wanted as high as $70 billion for the company, placing it well above Microsoft's $55 billion offer. This large gap between what Microsoft was willing to pay and what Salesforce was seeking is reportedly the main reason the companies failed to reach an agreement.

Up until recent years, Microsoft and Salesforce.com have been major competitors, offering many similar cloud-based solutions. After Nadella took the reins as Microsoft's CEO, Salesforce.com began knitting a tight relationship with Microsoft. The companies announced a strategic partnership last year in May that has led to new integration of Salesforce services in Office 365, Sharepoint, Outlook, Power BI, and more.

It is currently unknown if and how these talks (or lack thereof) may affect Microsoft's and Salesforce.com's business relationship. With the news, Salesforce.com stock rose 2.88%, trading at an all time high of just over $75. This puts the company at a market valuation of around $50 billion, $5 billion less then Microsoft's rumored offer. For now talks have died down, and it is uncertain whether they will start back up again.

Source: CNBC

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