Key points
- Bay Area tech firms intensify AI race for future innovation
- Salesforce specialises in customer relationship management
- Salesforce, Informatica shares rise after $8b acquisition announcement
ISLAMABAD: United States software giant Salesforce announced on Tuesday that it is acquiring Informatica, a provider of AI-driven data management tools, in an $8 billion deal — one of the largest in Salesforce’s history.
The move highlights the intensifying focus on artificial intelligence among Bay Area tech firms as they compete to drive the next wave of technological advancements, according to Reuters.
Based in San Francisco, Salesforce specialises in customer relationship management (CRM) software and helps companies organise sales and customer data.
In a press release, the company said acquiring Redwood City-headquartered Informatica would accelerate its development of autonomous AI agents capable of operating without human intervention.
Salesforce already operates a data platform known as Data Cloud and owns integration software firm MuleSoft and data visualisation company Tableau.
Intelligent AI solutions
“Combining the strengths of Data Cloud, MuleSoft, and Tableau with Informatica’s cutting-edge data management capabilities will allow us to deliver more intelligent, secure, and scalable AI solutions across industries,” said Marc Benioff, Salesforce’s chairman and CEO.
He added that the acquisition would reinforce the company’s position in the enterprise data market, estimated to be worth over $150 billion.
Informatica noted that the deal would provide Salesforce with tools for data lineage and governance, key for regulatory compliance. Informatica serves a wide range of sectors, including retail, government, education, and financial services.
Unlocking AI’s potential
“Partnering with Salesforce marks a major step forward in our mission to unlock the full potential of data and AI for businesses worldwide,” said Informatica CEO Amit Walia.
Under the agreement, Salesforce will pay Informatica shareholders $25 per share in cash — a 30 per cent premium over Informatica’s closing price last Thursday.
The deal comes after Informatica’s shares dropped as much as 59 per cent following the breakdown of earlier acquisition talks with Salesforce in 2024, according to Bloomberg.
The company’s share price has also taken a hit this year after underwhelming quarterly earnings. In May, shares fell after the firm reported earnings per share below analysts’ expectations, despite posting a 4 per cent year-on-year rise in Q1 revenue to nearly $404 million.
Following the acquisition announcement, both companies’ shares rose. Salesforce closed up 1.5 per cent at $277.19, while Informatica ended the day up 6 per cent at $23.91.
