M&A Rumors: Does Amazon Want to Buy Messaging Startup Slack?

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Rumor has it that Amazon.com, Inc. (NASDAQ:AMZN) may want to acquire messaging startup Slack.

M&A Rumors: Does Amazon Want to Buy Messaging Startup Slack?

The rumors that Amazon wants to acquire Slack come from unnamed sources that are close to the matter. These sources claim that the online retailer is considering buying the messaging service for $9 billion. This would make its AMZN’s largest acquisition yet.

If Amazon wants to spend $9 billion on Slack, is has the money to do so. A recent look at the company estimates that it had roughly $21.5 billion in cash and equivalents at the end of March. AMZN reportedly isn’t the only tech company that wants to take Slack for itself, but none others were named.

Slack’s latest funding round took place in 2016 and it raised $200 million. This gives the company a total value of $3.8 billion. The company isn’t planning an initial public offering yet, saying that the business is still growing too quickly to make solid plans.

Amazon’s possible interest in Slack makes sense. The company has been looking to better compete in the business market with Microsoft Corporation (NASDAQ:MSFT) and Cisco Systems, Inc. (NASDAQ:CSCO). It already has its own audio and video communication service for businesses, but Slack could help it strengthen its position in the field by adding messaging, reports Bloomberg.

Slack already has a strong user base for Amazon to take if an acquisition occurs. The messaging service has 5 million active users a day and 1.5 million are paying customers. Business that pay for the service get access to special features, but anyone can use it for free.

AMZN stock was down 1% as of Thursday morning.

As of this writing, William White did not hold a position in any of the aforementioned securities.


Article printed from InvestorPlace Media, https://investorplace.com/2017/06/amazon-slack-amzn/.

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