Microsoft and Salesforce Carve Out a Slice of Informatica Pie

Updating a item we posted in April about Informatica’s impending acquisition by Permira and the Canada Pension Plan Investment Board, it looks as though Microsoft and Salesforce have also thrown their respective hats into the ring, gobbling up their own stakes in the Data Integration Giant. Although their shares of the company are unknown, the acquisition, which was completed last week for a reported $5.3 billion ($48.75 per share), has made waves in the enterprise IT world. Informatica is now a private company and will no longer be traded publically via the NASDAQ.

Sohaib Abbasi, Informatica’s former Chief Executive and current chairman explains: “While delivering immediate compelling value to our shareholders, we remain committed to the long-term success of our customers, partners, and employees. Permira and C.P.P.I.B. share both our vision for Informatica to power the data-ready enterprise and our conviction in sustained long-term growth.”

Informatica is the largest independent provider of Data Integration software in the world. With the news, Informatica also announced changes to some of their leadership positions. The company, which boasts more than 5,800 enterprise customers around the globe, will now enter an uncertain phase of sorts, with goals to raise subscription and program-based revenue. As of 2015 Q2, Informatica posted $1 billion dollars in revenue, with a 13 percent growth.

Under private ownership, Informatica plans to continue its growth via master data management, integration analytics, cloud integration, and security. In addition, the company plans to search for new takeover targets with support from its new backers.

Microsoft and Salesforce will now become strategic investors in Informatica, and will look to add to their own portfolios in the process. Microsoft and Salesforce were brought in by the other two investment firms due to their past relationships with Informatica, as both have partnered with the company in some capacity in recent years.

In a statement, Microsoft said, “Informatica has been a strong part of Microsoft’s partner ecosystem as a data integration leader and we are excited to support Informatica in this new stage of growth as a private company”, according to the New York Times.

Anil Chakravarthy, acting CIO of Informatica notes: “It is a privilege to lead the world-class Informatica team in this promising new phase of growth as a private company. Our transformative innovation roadmap includes four distinct billion-dollar opportunities: cloud integration, next generation big data integration, MDM solutions and data security. And living our customer-first culture, we will evolve our business model to match customers’ preferences for pay-for-use subscription offerings.”

Informatica’s acquisition has lots of possible outcomes, and it will be very interesting to see how the company responds in the near term since it has so many enterprise customers already. One wonders if Microsoft and Salesforce going in on this deal together is a precursor to an eventual merger, a topic that has been swirling around the rumor mill for some time.

Check out Informatica’s full press release.

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