Sales-management software company Salesforce is acquiring Seattle-based data-visualization company Tableau Software in an all-stock deal valued at $15.7 billion.
The deal brings together two companies that have already carved out strong niches in the digital-transformation market at a time when the demand for such services is expanding rapidly. A forecast by market-intelligence firm International Data Corp. projects that companies around the world will spend $1.18 trillion this year, up nearly 18 percent from last year, on technologies and services that will accelerate digital transformation of their businesses.
"Joining forces with Salesforce will enhance our ability to help people everywhere see and understand data," says Adam Selipsky, president and chief executive officer of Tableau, which boasts some 86,000 customers, including companies like Verizon, Netflix and Charles Schwab.
"As part of [Salesforce,] the world’s #1 CRM [customer-relationship management] company, Tableau's intuitive and powerful analytics will enable millions more people to discover actionable insights across their entire organizations,” Selipsky adds.
The proposed merger has been approved by the board of directors of both companies and is expected to close in Salesforce’s third quarter ending Oct. 31, 2019 ― subject to customary closing conditions. Tableau, which employs some 4,200 people, is expected to remain headquartered in Seattle and under the leadership of current CEO Selipsky, according to a press statement announcing the deal.
Salesforce, employs a total of some 35,000 people and is based in San Francisco. The company employed some 800 people in Washington as of year-end 2018 and maintains a Seattle-area office in Bellevue. The company expects the acquisition of Tableau to add about $400 million to its fiscal 2020 revenue but decrease earnings by about 37 to 39 cents per share.
Tableau (NYSE: DATA) posted a net loss of $77 million on revenue of $1.15 billion in 2018. Salesforce (NYSE:CRM) recorded net income of $1.1 billion on revenue of $13.3 billion for its fiscal year ended Jan. 31, 2019.