Salesforce apparently poised to slurp data management outfit Informatica

Investors get excited about using AI to make AI easier

Supercolossal SaaS seller Salesforce is reportedly poised to acquire cloud data management outfit Informatica.

Reports in Bloomberg and The Wall Street Journal claim talks are advanced.

The Register has often observed such news appearing over the weekend before a Monday (US time) announcement. However, reports suggest these talks aren't considered certain to succeed. Maybe a different pattern will play out.

Nor do the reports discuss the price Salesforce would pay. Informatica's shares have surged from around $29 to over $38 during 2024, leaving it with market capitalization of over $11 billion. Acquisitive companies usually pay a premium for their prey – to satisfy investors they should sell instead of holding out for a better deal – which could be why Informatica's share price spiked to around $44 as news of the Salesforce talks spread over the weekend.

If the deal does go ahead, Salesforce will take possession of a firm that promises to tidy up its customers' data using AI.

That's something Salesforce customers could conceivably value, for two reasons.

One is that the rush to experiment with generative AI needs data that is seldom tied up in a bow ready for processing. Salesforce's Einstein offers decent AI capabilities across its SaaS suite, but helping its customers prepare their data estates for generative AI is an obvious extension – especially if Informatica's wares speed that process.

The other is that the metadata describing customer data continues to sprawl across multiple sources and platforms. Salesforce's suite of apps will benefit from tools that help to consolidate it all. Again, if Informatica can make that process faster, few will complain.

If the deal goes ahead, it will sit alongside previous Salesforce mega-deals – such as the 2018 $6.5 billion acquisition of MuleSoft, the 2019 takeover of Tableau for $15.7 billion and the 2021 slurp of Slack for a cool $27 billion.

Since that last big buy, Salesforce has come under pressure to improve its performance. It responded with swingeing job cuts and cost-trimming, plus disbanding its committee dedicated to mergers and acquisitions.

Reports of talks with Informatica suggest that Salesforce has found other ways to consider acquisitions. ®

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