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Salesforce.com Looking to Acquire to Spur German Growth

Salesforce.com Inc. Chief Executive Officer Marc Benioff said, “We have a dream of becoming a $1 billion software company right here. We’re looking at making some local acquisitions to improve our position here in the market.” Photographer: Patrick T. Fallon/Bloomberg
Salesforce.com Inc. Chief Executive Officer Marc Benioff said, “We have a dream of becoming a $1 billion software company right here. We’re looking at making some local acquisitions to improve our position here in the market.” Photographer: Patrick T. Fallon/Bloomberg

July 3 (Bloomberg) -- Salesforce.com Inc. is considering acquisitions of German software providers and system integrators as part of a plan to reach $1 billion in local sales, Chief Executive Officer Marc Benioff said in an interview.

Salesforce, a San Francisco-based maker of online customer-management, support and HR software, may buy companies in Germany that make cloud-computing applications or help customers integrate them with their existing computer systems, Benioff said in Munich, where he’s scheduled to give a keynote address at the company’s Salesforce1 customer conference today.

“We have a dream of becoming a $1 billion software company right here,” Benioff said. “We’re looking at making some local acquisitions to improve our position here in the market. These could be core technologies as well as system integrators or next-gen cloud companies. We are always looking for fantastic companies we think are doing great work.”

Salesforce, which analysts estimate may report $5.3 billion in sales this year, is vying with German enterprise software giant SAP AG and American competitor Oracle Corp. to capture a greater portion of businesses’ spending on software applications delivered as a service over the Internet, a market worth $21.6 billion, according to research company IDC.

Salesforce, which Benioff founded in the late 1990s and took public 10 years ago, garnered $231 million in revenue from Germany, France and the U.K. in the fiscal first quarter ended April 30.

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Shares of Salesforce fell less than 1 percent to $58.91 at yesterday’s close in New York. The stock has risen 6.7 percent this year.

Benioff, who said he’s been traveling in Europe for the past month and recently had dinner with German Chancellor Angela Merkel in Berlin, said he plans to open “multiple” data centers in the country over time and respect the country’s culture of information privacy. Salesforce has less than 1,000 employees in Germany and plans to increase that number.

“It’s not a market where you can just localize,” he said. Bloomberg News reported in March that Salesforce plans to open a German data center by mid-2015, and the company last week said it plans to open one in France.

Customers including Deutsche Telekom AG, Deutsche Post AG’s DHL and Software AG plan to attend the Munich conference. Deutsche Telekom’s T-Systems said today it reached an agreement to become a service provider for Salesforce’s upcoming German data center. The companies in March announced a deal to deliver online software to customers in Germany, Switzerland and Austria.

Salesforce has set a goal of reaching $10 billion in revenue worldwide and expects that to occur “probably in fairly short order,” Benioff has said earlier this week.

To contact the reporter on this story: Aaron Ricadela in Frankfurt at aricadela@bloomberg.net

To contact the editors responsible for this story: Kenneth Wong at kwong11@bloomberg.net Mark Beech, Jillian Ward

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