Should Salesforce and Oracle merge? – The Information

Investing.com — The Information said in an article on Wednesday that a potential merger between Oracle (NYSE:) and Salesforce (NYSE:) could create a powerhouse in the enterprise software space, but such a deal would not come without challenges. 

Larry Ellison, Oracle’s founder, might find himself weighing the strategic advantages of acquiring Salesforce against significant logistical and financial hurdles, The Information reported.

Salesforce, with its $312 billion market capitalization, could be a valuable asset for Oracle, adding more than $10 billion in annual cash flow to fuel Oracle’s growing investment in AI and data centers. 

The publication says in its article that, at first glance, a potential Salesforce deal looks too expensive for Oracle. However, they state it could be done with stock or possibly a combination of stock and cash with the cash amount financed with borrowings.

Ellison’s decades-long relationship with Salesforce CEO Marc Benioff might also make the merger more feasible, potentially positioning Benioff as Ellison’s successor, said The Information.

A merger would create a combined entity with $92.1 billion in annual revenue and a market cap of $795 billion, making it a major player in enterprise software alongside Microsoft (NASDAQ:). 

While Oracle’s focus lies in tools for financial planning and regulatory filings, Salesforce specializes in customer relationship management, providing an opportunity for cross-selling products across both companies’ client bases.

Oracle’s finances, however, pose a challenge. The Information says that despite its $480 billion market cap, Oracle’s $90 billion in debt and rising capital expenditures—driven by its AI infrastructure ambitions—leave little room for maneuvering. 

Regulatory hurdles could also complicate the deal. While The Information notes that the Trump administration may adopt a relaxed stance toward antitrust concerns, scrutiny is inevitable for a merger of this magnitude.

The publication concludes that whether Ellison is willing to make concessions to secure the merger remains uncertain, but the deal could redefine the enterprise software landscape.