Salesforce's $ 15.7 billion ad on Tableau announced Monday started with a text, joining a San Francisco mansion meeting, and falling apart several times.
About six months ago, Salesforce CEO Marc Benioff sought a way to use all the data generated through MuleSoft, the large data platform it purchased for $ 6.5 billion. USD in May 2018, according to two people familiar with the process.
Benioff, known for his personal involvement in acquisitions, reached the Tableau team over the text message to see if there was any way the two companies could work together, the people said.
Over the next six months there was a lot of push and pull. The slip had almost come together three times before, one person said. But market volatility was still in the way.
From December 1
At the same time, the CBOE volatility index, a measure of market volatility, hit its highest point in 2018. Typically, companies will not review major events such as mergers or public offers if the VIX has spiked.
The stock prices of both companies continued to fluctuate around 5% to 10% almost every week until the contract was signed.
Since none of the companies were willing to bid for price and it was a total stock agreement, the deal was postponed until the market had returned, the people said.
On June 3, less than a week prior to the announcement of the agreement, technical stocks were severely affected by concerns that Facebook and Google could gain more anti-trust control. Salesforce shares are traded at 4% and the Tableaus share fell to $ 108.26, the lowest price for six months.
Until last Friday, it was not so clear that the agreement would happen.
"I think we've been trying to do something for a long time and it's just hard to get the stars to adjust," Benioff said on a conference call Monday. "And I think we're lucky we got there."
Ultimately, Salesforce agreed to acquire Tableau in the all-stock transaction that gave Tableau 1,103 shares in Salesforce for each share in its own share. This assessed the company at $ 175 per. Stock up from where it closed Friday to $ 125.22.
If the agreement is approved by shareholders, the acquisition is expected to close by the end of October.
Tableau bounced back from uro
Tableau is a data visualization platform that transforms data surfaces into easy-to-digest graphics. It competes with Microsoft Azures Power BI and also Looker, which Google acquired last week for $ 2.6 billion.
When Salesforce approached the company for a purchase six months ago, Tableau was on the upswing after a period of turmoil.
The inventory hit a value of $ 128.74 per. Share in 2015 before falling and falling to just $ 37.22 per share. Share at a time in 2016. To be able to correct the course, the company switched to a subscription turnover model in 2017 from a model where customers paid a higher price up front to use it all the time. In the years since, the stock has slowly gained momentum, and finally the previous high exceeded last year.
It was about the time that things took up financially for Tableau, that Benioff initiated discussions.
Read more: From a mail to a $ 6.5 billion agreement in 46 days: How Salesforce's bid on MuleSoft came together
With its downturn in the mirror, Tableau was CEO Adam Selipsky and the board made it clear that there would be a high bar for the company to sell, two of the people said. On the other hand, Salesforce was very conscientious about the optics of profit on an acquisition, they said.
As the talks accelerated, Benioff invited both to his home in one of San Francisco's most toned neighbors, with large houses and Pacific Ocean views. It was there that the teams "put meat on the bones" of the deal, one person said.
Salesforce advised Bank of America Merrill Lynch financially. The bank had previously worked with the company on the acquisition of MuleSoft.
Tableau worked with Goldman Sachs on the deal. The bank was taken back to Tableau's IPO in 2013 and followed up on offers later that year and again in 2014. Goldman had also recently sold three other companies to Salesforce, including MuleSoft.
It is unclear whether Tableau spoke to other companies during the takeover discussions.
Salesforce refused to comment.