Microsoft, Salesforce talks fell through on pricing: CNBC

Fri May 22, 2015 2:46pm EDT
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By Devika Krishna Kumar and Anya George Tharakan

(Reuters) - Microsoft Corp (MSFT.O: Quote) and Inc (CRM.N: Quote) held "significant talks" this spring but failed to agree on a price, CNBC reported, citing people familiar with the matter.

Microsoft was willing to offer about $55 billion for the world's biggest maker of online sales software. Salesforce founder and Chief Executive Marc Benioff had expected as much as $70 billion, CNBC reported on Friday.

A potential bidder can go up to $70 billion on the high end and Microsoft, Oracle Corp (ORCL.N: Quote) and Inc (AMZN.O: Quote) are the companies most likely to be suitors, FBR Capital Markets analyst Dan Ives said in an email to Reuters.

Salesforce shares rose as much as 4 percent in afternoon trading, while Microsoft shares fell 1 percent.

Apart from the high asking price, Microsoft Chief Executive Satya Nadella was somewhat reluctant to pull the trigger on a deal of such size and consequence for his company, CNBC said.

Microsoft and Salesforce declined to comment on the report.

"Salesforce is the golden jewel in the cloud, given its leadership position and stellar brand and distribution, all that would have fit well within the Microsoft ecosystem in our opinion," Ives said.

San Francisco-based Salesforce leads the global customer relationship management (CRM) market, which is valued at $23 billion annually, according to tech research firm Gartner.   Continued...

A Salesforce sign is seen during the company's annual Dreamforce event, in San Francisco, California November 18, 2013. REUTERS/Robert Galbraith