Corporate chatroom startup Slack Technologies has received recent inquiries about a potential takeover from technology companies including Amazon.com, people with knowledge of the situation said, a deal that would be the internet-commerce giant's biggest ever.
San Francisco-based Slack could be valued at at least $9 billion in a sale, said the people, who asked not to be identified because the matter is private. An agreement isn't assured and discussions may not go further.
Buying Slack would help Seattle-based Amazon bolster its enterprise services as it seeks to compete with rivals like Microsoft and Alphabet's Google. The company's cloud-hosting unit, Amazon Web Services, in February unveiled a paid-for video and audio conferencing service -- Amazon Chime -- that lets users share content.
Representatives for Amazon.com and Slack declined to comment.
Amazon's biggest acquisition to date came in 2014, when it agreed to buy gaming service Twitch Interactive for $970 million in cash to bolster its entertainment offering, according to data compiled by Bloomberg.
The Seattle-based company had about $21.5 billion in cash and equivalents at the end of March, the data show.
Amazon has been expanding beyond its e-commerce platform, experimenting with food delivery, physical stores and dominating the cloud-storage business. Its US$99-a-year Amazon Prime subscription, which includes delivery discounts, photo storage and music- and video-streaming, keeps shoppers engaged with the website. Echo, its voice-controlled speaker that makes it easy to order from the website or even from a pizza-delivery company, embeds Amazon even further in people's lives .
The launch of Chime put it in direct competition with Microsoft's Skype and Cisco Systems's WebEx service in providing conferencing to corporate clients. The service was added to an increasing roster of AWS products, including security systems, a business intelligence service named Quicksight and hardware to allow customers to securely transfer large amounts of data -- all aimed at business clients.
Redmond, Washington-based Microsoft had considered acquiring Slack, people familiar with that matter said last year, but the discussions never got serious enough to involve CEO Satya Nadella or the company's board. Microsoft opted instead to build a similar software.
Tech companies have announced just $49 billion of deals this year, down more than 40 per cent since the same period in 2016. Cisco Systems inked the biggest US tech deal of the year in January, agreeing to pay $3.7 billion for AppDynamics before the software developer startup was due to price its initial public offering.
Slack raised $200m in its latest funding round in 2016, led by Thrive Capital Management, valuing it at $3.8b. The company, which introduced its business chat software in 2013, recently turned its eye to bigger users. In January, Slack debuted an enterprise version of its chat software that allows tens of thousands of employees to collaborate across teams at major corporations like IBM.
Other backers include GGV Capital, Comcast Ventures, Accel Partners, Social Capital, Spark Growth and Index Ventures. Bloomberg Beta, the venture capital arm of Bloomberg LP, is an investor in Slack.
Slack's Canadian-born co-founder and chief executive officer, Stewart Butterfield, said last month in a Bloomberg TV interview that an IPO "would be years away," citing some unpredictability as the business continues to grow quickly.
The company has about 800 employees across seven offices, including one recently opened in London. Slack has 5 million daily active users -- 1.5m of whom pay to use the service -- and had $150m in annual recurring revenue as of Jan. 31.