Salesforce to pay one time cash purchase price of $300M for Salesforce.org
In the process of combining the two organizations, Salesforce.org will convert from a California public benefit corporation into a California business corporation and Salesforce will pay a one-time cash purchase price of $300M for all shares of Salesforce.org. The $300M will be distributed to the independent Salesforce.com Foundation, a California nonprofit public benefit corporation and 501(c)(3) organization, for further distribution by the Foundation for future philanthropic purposes. The company will make additional contributions to the Salesforce Foundation. Salesforce will create a new nonprofit and education vertical led by Salesforce.org CEO Rob Acker. The new vertical will be responsible for the sales, marketing and customer success of the Salesforce Customer Success Platform to the nonprofit and education communities, as well as the development of Salesforce.org's Nonprofit Cloud, Education Cloud and Philanthropy Cloud vertical applications. The closing of the combination is subject to approval by the Attorney General of California and other customary closing conditions. Upon the closing of the transaction, Salesforce will terminate its current reseller agreement between Salesforce and Salesforce.org, and Salesforce will incur a one-time non-cash accounting charge in the fiscal quarter in which the transaction closes. Salesforce currently estimates that this non-cash charge will be approximately $200M, but the final amount will not be determined until the closing of the transaction, and such estimate is subject to change. The one-time non-cash charge will be reflected as an operating expense for both the company's GAAP and non-GAAP results.