Salesforce-Informatica acquisition talks fall through: Report

Salesforce’s negotiations to acquire enterprise data management software provider Informatica have fallen through as both couldn’t agree on the terms of the deal.

That the talks about the deal had come to a close was reported by The Wall Street Journal (WSJ) and Reuters, citing an anonymous source.

The disagreement about the terms of the deal is more likely to be around the price of each share of Informatica, WSJ reported, adding that Salesforce was negotiating a mid-30s price per share with the enterprise data management software provider.

On April 12, when WSJ reported about the acquisition, Informatica shares were trading at $38.48. In contrast, at last week’s close Informatica’s shares stood at $35.19, translating the value of the company to $11.2 billion with the inclusion of debt.

An email sent to Salesforce and Informatica enquiring about the deal didn’t elicit an immediate response but an earlier email sent to enquire about the acquisition last week received a response from Salesforce saying that the company doesn’t comment on speculations.

According to analysts, if the deal went through, it would not only mean consolidation in the iPaaS market but also a new revenue source for Salesforce.

Salesforce was most likely to integrate Informatica’s offerings with its MuleSoft offerings, which competes in the iPaaS market along with vendors such as Informatica, Oracle, SAP, Microsoft, Boomi, IBM, TIBCO, and AWS.

MuleSoft, acquired by Salesforce in 2018 for $5.7 billion, offers the Anypoint Platform — an iPaaS service — that offers integration, automation, and API management capabilities.

On the other hand, Informatica offers similar services via its Intelligent Data Management Cloud (IDMC) platform. Some of the services and components of the platform include cloud API and application integration, Cloud B2B Gateway, Cloud Integration, API Manager and API Center, and data integration among others.

Experts had said that the deal could be a significant opportunity for Salesforce as it comes at a time when the average enterprise, especially the large ones, has over 1,000 applications and data sources, which throws up the challenge of cleaning up long-tail data and matching it with core enterprise data.

Informatica too, according to the experts, could have gained from the acquisition, at least from the investor’s perspective.

The acquisition would be beneficial for Informatica to counter its perceived inability to communicate a roadmap or strategy that would satisfy Wall Street, they said, with the warning that Informatica employees could have faced some downsizing.