US software giant Salesforce acquires Israeli software company Clicksoftware for $ 1.35 billion, most of it in cash, according to Calcalist. The price reflected value higher than its value on NASDAQ.
This is Salesforce’s second significant acquisition in Israel-related companies. In July 2018, Datorama acquired for more than $800 million.
Founded in 1979 by Moshe Ben Basat, under the name IET – Intelligent Electronics. Later it changed its name. Clicksoftware develops logistics management systems for customer service. In 2000, the company issued its shares on NASDAQ.
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The biggest beneficiary of the deal is the private equity investment Francisco Partners after Clicksoftware was sold for $438 million in 2015. Clicksoftware CEO Mark Cantini, the former CEO of Autotesk joined the company in early 2018.
The company’s founder, Moshe Ben Basat, appointed advisor to the management and a member of the board of directors. Currently, Ben Basat is not involved in the company’s activities.
The connection between the American giant and the Israeli company started in 2016. Salesforce selected ClickSoftware as its key partner in service management. Under the agreement, the Israeli company became an arm of Salesforce in the field.
This was one of the first times Salesforce chose an outside company to run various meeting management and optimization activities. This choice allowed Salesforce to significantly shorten its time to market.
To comply with the agreement, Clicksoftware provided a significant team to support all of the company’s operations. Connecting to the US giant changed Clicksoftware significantly as it developed its cloud.
The Israeli company headquarters are located in Petah Tikva and the US headquarters is located in Burlington, Massachusetts. The company has 60 customers worldwide including Deutsche Telekom, telecommunication company Telstra, IBM SAP and leading gas and energy companies.
Marc Benioff founded Salesforce in 1999. The company has about 29,000 employees worldwide. The company is developing cloud computing solutions for the business sector, with emphasis on solutions for sales, customer relations and business services. One of its biggest competitors is Oracle, the company Benioff left.
Francisco Partners is one of the largest American private equity firm focused exclusively on investments in technology and technology-enabled services businesses. The company is highly active in Israel.
Among the acquisitions made in recent years include the acquisition of cyber company NSO for $120 million, Syntech Media for $400 million in 2016, R2NET jewelry site for $140 million in 2017 and there are more.
Following the acquisitions, Francisco Partners is shoring up the companies it invests with the goal of selling them within a few years at a high multiplier on investment. A good example of this is Exlibris. Ex Libris Group an Israeli software company that develops integrated library systems and other library software. It was purchased in 2006 for $62 million and sold about two years later to private equity fund ProQuest for $200 million.
It is estimated that Clicksoftware’s 200 local employees will integrate into the Salesforce Development Center in Israel upon completion of the acquisition. ClickSoftware has 700 employees in the United States. The US giant said it will expand its development center in Israel to include more than 600 employees.