Salesforce announced Tuesday it will buy data management company Informatica for about $8 billion. This is Salesforce’s biggest purchase since buying Slack for $28 billion in 2021.
The deal helps Salesforce compete better in the growing artificial intelligence market. By owning Informatica, Salesforce can better control how business data is managed and used, which is crucial for AI products.
Why This Deal Matters for AI
Salesforce CEO Marc Benioff says combining both companies will create “the most complete, agent-ready data platform in the industry.” This strengthens Salesforce’s position in the data enterprise market, which is worth over $150 billion.
Salesforce has been selling AI agents – computer programs that can do routine work without human help – to businesses for hiring and customer service. The company has already closed more than 1,000 paid deals for “Agentforce,” its platform for creating AI-powered virtual assistants.
The purchase of Informatica will give Salesforce better data management tools as it focuses more on AI-powered products. This is important because good data management is essential for AI to work properly.
The Business Details
Salesforce is paying $25 per share for Informatica, which is about 30% more than Informatica’s stock price before news of the deal came out. The company plans to pay using both cash and new loans.
Several other companies were interested in buying Informatica, including private equity firms like Thoma Bravo and Cloud Software Group. But Salesforce won the bidding war.
The deal should close early next year, around February. Salesforce expects it will help improve their profit margins starting in the second year after the purchase is complete.
Analysts believe this move helps Salesforce catch up with competitors, since data management software is now usually sold as part of larger software packages.
This blog post is for informational purposes only