UPDATED 14:30 EDT / JUNE 04 2013

NEWS

Salesforce Lands ExactTarget for $2.5B in its Biggest Acquisition Yet

In the second big deal of the day, Salesforce.com has just announced the biggest acquisition in its history, buying up cloud marketing platform ExactTarget for a whopping $2.5 billion.

According to the company’s press release, Salesforce is paying $33.75 a share to take over ExactTarget, which is a huge 52% premium on the company’s closing share price of $22.10 yesterday.

Today’s acquisition is just the latest in a long line of high-profile buyouts in recent years as it looks to boost its market offerings. Last year the company snapped up social media management platform Buddy Media in a $689 million deal, while two years ago it acquired Radian6 for its superb software that lets marketers track their campaign’s effectiveness on sites like Facebook and Twitter.

The reason for Salesforce’s interest in Exact Target is obvious enough. The acquisition means that Salesforce can now offer its customers a full portfolio of digital marketing services to manage their campaigns on social media networks, mobile platforms and traditional email. In its press release, Salesforce cited recent surveys that show marketers are increasing their spending on the digital side of things. Separately, the industry analyst firm Gartner says that consumer technology companies are likely to spend as much as 30% of their advertising budget online in the next two years.

For these reasons, ExactTarget seems to fit the bill perfectly for Salesforce. For those unfamiliar with ExactTarget is one of the most sophisticated email marketing platforms around, and one that has seen a rapid upswing in usages as companies switch focus to online advertising. Its customers include Coca Cola, among numerous other big name consumer brands.

For Salesforce, the challenge will be to take ExactTarget’s marketing tools and incorporate it into its own increasingly exotic suite of products in order to create PROFITS for its customers. The company says that following the acquisition, its revenues are expected to increase from $120 to $125 million this year – no small change, but for a company that rakes in around $4 billion a year anyway, certainly nothing drastic either.


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