DATA Tableau Software Inc

By Kimberly Chin 

Salesforce.com Inc. agreed to buy data-analytics platform Tableau Software Inc. for more than $15 billion in stock, a deal aimed at expanding its digital offerings beyond customer-relationship management tools.

The San Francisco business-software company has made a series of large acquisitions in recent years that would give clients more services and tools to analyze their customer interactions and sales and marketing data.

Last year, Salesforce bought web-based service MuleSoft Inc. in a $6.5 billion deal, as it sought to migrate more clients to cloud services. The company also bought e-commerce platform Demandware Inc. for $2.8 billion in 2016.

Salesforce is betting on a digital transformation that would get many of its current and prospective customers to update their legacy applications and move them onto the cloud.

World-wide spending on technologies and services to move companies into the digital age is expected to reach $1.8 trillion by 2021, Salesforce said, citing data from International Data Corp.

Other technology companies are also looking to get into the business-intelligence and data-analytics business. Last week, Alphabet Inc.'s Google acquired Looker for $2.6 billion to help it mine large caches of data for insights. Microsoft Corp. has also looked to M&A to bolster its cloud business Azure, which has given its top line a big boost in the past year.

Software from Tableau, which was founded in 2003, allows companies to build databases, spreadsheets, graphs and maps from their data. More than 86,000 organizations globally work with Tableau, the company said. Tableau's clients include Charles Schwab Corp., Verizon Communications Inc. and Southwest Airlines Co.

"With Tableau, we can go to every single department and every single user and enable them to help see and understand data," said Bret Steven Taylor, Salesforce's president and product chief, on a conference call Monday.

Salesforce said Monday that the deal with Tableau has an enterprise value of $15.7 billion. Tableau's Class A and B shareholders would receive 1.103 shares of Salesforce's common shares for each share they own.

In 2016, The Wall Street Journal reported that Tableau was referenced on a leaked internal presentation that showed a list of potential Salesforce merger and acquisition targets. Salesforce said at the time it would "routinely survey the industry landscape across a wide range of companies, but acquire very few."

On Monday, Marc Benioff, Salesforce chairman and co-CEO, said he has long had a deep admiration for Tableau. Mr. Benioff said that when he speaks with clients, "we're talking about all the different products they're using: Sales Cloud and Service Cloud and Marketing Cloud, and they're using all of our various capabilities. And then they'll start talking about how they're using Tableau."

Shares of Tableau, which has gained 40% for the year, jumped 34% on Monday. Salesforce's shares fell 4.9% though they had risen 12% for the year.

Tableau would keep its headquarters in Seattle and continue to operate independently under its own name. It will continue to be led by Chief Executive Adam Selipsky and the current leadership team, the companies said. Mr. Benioff said in the call that Seattle will become Salesforce's second headquarters.

Salesforce said it would combine Tableau's capabilities with Salesforce Einstein, its artificial intelligence-powered platform, which would help provide services at every touchpoint of sales, marketing, service and commerce for customers.

The transaction is expected to add $350 million to $400 million to Salesforce's revenue in the current fiscal year. It now expects sales between $16.45 billion and $16.65 billion for the year ending Jan. 31.

Salesforce expects the deal to close in the quarter ending Oct. 31.

Write to Kimberly Chin at kimberly.chin@wsj.com

(END) Dow Jones Newswires

June 10, 2019 12:13 ET (16:13 GMT)

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