Why Salesforce Investors are Wary of the Informatica Acquisition News

Why investors aren't pleased that Salesforce might acquire Informatica

Sources speaking to the Wall Street Journal over the weekend say Salesforce is in "advanced talks" to acquire Informatica. With Informatica's market capitalization sitting just below $11 billion this morning, the deal would be one of Saleforce's largest -- though also still well below the nearly $28 billion price tag it paid to purchase Slack Technologies three years ago. With just over $14 billion in cash on hand at the end of its most recent quarter, Salesforce could potentially fully fund a deal without diluting existing shareholders.

What's next for Salesforce investors?

There are no guarantees, of course, that Salesforce and Informatica will come to a formal agreement. But news of this potential acquisition has brought fears of renewed proxy battles from activist investors back to the forefront. If that means diverting Salesforce's attention away from focusing on existing operations as it fosters yet another mammoth business integration, it's hard to blame some weary investors for selling in response today.Should you invest $1,000 in Salesforce right now?