IMAGE SOURCE: Demandware Inc.
So what: More specifically, Salesforce has signed a definitive agreement to purchase Demandware through a tender offer for all outstanding shares at $75 per share in cash. That's a 56% premium to yesterday's closing price, and values Demandware at roughly $2.8 billion net of cash acquired.
Salesforce CEO Marc Benioff stated: "Demandware is an amazing company -- the global cloud leader in the multi-billion dollar digital commerce market. With Demandware, Salesforce will be well positioned to deliver the future of commerce as part of our Customer Success Platform and create yet another billion dollar cloud."
The companies' combined press release also revealed the acquisition will allow Salesforce to extend its CRM platform to include what will be dubbed the new Salesforce Commerce Cloud, positioning it to capture a new multi-billion market. Meanwhile, Demandware's customers will be able to take advantage of Salesforce's industry-leading sales, service, marketing, communities, and analytics solutions.
Now what: The deal is expected to close some time in Saleforce's fiscal second-quarter 2017, which ends July 31, 2016, and is still subject to customary closing conditions including the acceptance of a majority of Demandware shares in the tender offer. But as it stands, it's hard to argue with such a healthy acquisition premium for Demandware shares. With the exception of shareholders who have held Demandware stock for close to a year (and for whom waiting to sell would result in more-favorable long-term capital gains taxes), investors would be wise to take today's profits and put them to work elsewhere.
