Some of the drama over the rumored acquisition of Salesforce.com by a larger software industry rival could come to a head today when Salesforce CEO Marc Benioff and his Sage counterpart, Stephen Kelly, share a joint press conference in San Francisco.
For weeks the rumor that Salesforce was being courted have been fueled by speculation in the financial press about Salesforce’s apparent engagement with investment bankers. The speculation was that it was figuring out how to deal with an unsolicited offer but all along I have felt that the signals were no very strong and that a Sage deal made more sense. I think Salesforce will take a minority position in Sage, in part as a good will gesture.
There was plenty of evidence if you knew where to look. Salesforce and Sage had made a joint announcement in the first quarter about Sage porting some of its accounting software to the Salesforce1 Platform and becoming a member of the Salesforce ecosystem. The existence of the press conference, being billed as a fireside chat, and the general plan, has also been known for two weeks.
On the other hand, the rumormongers failed to produce any solid evidence about who an acquirer might be and relied on hearsay and unnamed sources to build its case. The thing that tips the balance against the rumors for me is that so much that has gone on has been done behind closed doors. In a takeover attempt you normally see a lot of posturing and negotiating in public. Recall the spectacle when Larry Ellison’s Oracle decided to buy PeopleSoft and Siebel. Now, those were acquisitions!
We will know in a few hours, or not. Just as a paranoid might have real enemies, Salesforce could still be being pursued. But, if Salesforce were to invest in a piece of Sage, it would complicate the calculations of its valuation and could tip the balance against acquisition. I suppose you could view this as a form of poison pill.
(Cross-posted @ Beagle Research Group)