This article was originally published on ETFTrends.com.
Salesforce.com (CRM) traded lower on Wednesday as many wondered whether the company's $6.5 billion purchase of MuleSoft (MULE) was a good investment decision.
According to Investors Business Daily, "Salesforce.com, the leader in the field known as software-as-a-service, said Tuesday it is paying $44.89 a share for MuleSoft — $36 in cash and 0.0711 in Salesforce shares. The deal represents a 36% premium to MuleSoft's March 19 closing price."
Let's take a look at how this has affected ETFs with Salesforce exposure according to Yahoo Finance, at 1:30 p.m. Eastern time.
ETFs in the Green with Salesforce Exposure
- IGV iShares North American Tech-Software ETF with a 8.53% weighting up .29%.
- PSJ PowerShares Dynamic Software with a 5.30% weighting up .53%.
- IVFGC Ivy Focused Growth NextShares with a 5.10% weighting unchanged.
- FDN First Trust Dow Jones Internet Index with a 4.92% weighting up .60%
- SKYY First Trust ISE Cloud Computing Index with a 4.82% weighting up .23%
- ENTR Entrepreneur 30 Fund Large Cap Growth Equities with a 4.52% weighting up .7 %.
- IBLN Direxion iBillionaire Index ETF Large Cap Growth Equities with a 3.58% weighting up .5%.
Salesforce gets more than tech with this purchase with major customers like Coca-Cola, VMware, GE, Accenture, Airbus, AT&T and Cisc which gives Salesforce an ability to expand to a new client base. What’s more, the company has big revenue goals. The company has reached $10 billion in revenue, faster than any other software company. They have set their goal for $60 billion in revenue by 2034.
Salesforce has agreed to pay a pretty penny for MuleSoft, without any guarantee that it will grow into a company worth the price they paid. MuleSoft specializes as a kind of middle man in application programming interfaces, which help companies access or unlock their data. MuelSoft specializes in helping make different cloud-software programs come together in a unified system.
“Every digital transformation starts and ends with the customer,” Salesforce CEO Marc Benioff said in a statement. “Together, Salesforce and MuleSoft will enable customers to connect all of the information throughout their enterprise across all public and private clouds and data sources—radically enhancing innovation.”
According to The Verdict, "The move marks San Francisco-based Salesforce’s largest acquisition and demonstrates that chief executive Marc Benioff’s is on a mission to expand the company’s cloud-based portfolio."
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