$Salesforce.com(CRM)$ Informatica’s EV is $13.5B Pros: 1) Data resides in silos across different IT systems. Salesforce w/ Informatica could better help customers govern, clean, & make their data available - help competitively entrench Salesforce’s AI Data Cloud in companies’ analytics & AI road maps. 2) Salesforce revs growth contracting - has an appetite for large deals to refuel the cross-selling engine 3) Data management software is now most often sold as a component of mega-vendor tool kits 4) Salesforce has $15B in Total Cash
Cons: 1) Informatica founded over 30 years ago & has large install base & network of partners 2) Informatica to grow +7% in FY24 - slightly dilutive to Salesforce’s growth rate 3) Informatica valuation has risen sharply over the past year 4) Activist investors pushed Salesforce to cut costs, improve margins & buyback stock
Should Salesforce take smaller swing & buy smaller?
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