The US Department of Justice has written to Salesforce and Slack to ask a few questions about December’s $28bn merger announcement.
Although complying with the request could potentially delay the deal, Salesforce said it anticipated completing the transaction during its fiscal quarter ending 31 July 2021.
The legal to-and-fro relates to the antitrust division of the DoJ sending a so-called “second request” to the companies asking for additional information and documentary material. Technically, the request extends the waiting period (under the Hart-Scott-Rodino Antitrust Improvements Act of 1976) until 30 days after Salesforce and Slack have complied with the request.
In reality, the CRM giant and workplace collab company still have plenty of time to get the deal approved before their deadline for closing.
Nonetheless, the move follows increasing Biden-era interest in fair market competition. US Senator Amy Klobuchar, lead Democrat on the Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights, has introduced new legislation aimed at reinvigorating the US’s antitrust laws and restoring competition to markets.
Klobuchar is hoping to give federal enforcers the “resources they need to do their jobs, strengthen prohibitions on anticompetitive conduct and mergers, and make additional reforms to improve enforcement.”
Salesforce, which claims around 150,000 customers worldwide, agreed to buy Slack, which has around 10 million active daily users, for $27.7bn late last year. The plan is, according to the firms, to make the collaboration tool the interface for Salesforce Customer 360, the system it sells to create a single customer ID and profiles.
“Slack will be deeply integrated into every Salesforce Cloud,” the announcement read at the time.
Whether that integration unfairly locks out competitors from the market is something the DoJ will be weighing up.
Second requests are not uncommon, though. General Electric’s Baker Hughes deal, Charles Schwab and TD Ameritrade merger, and Anheuser-Busch’s Craft Brew Alliance buyout were also subject to similar requests. ®