Wait, What? New Report Claims Microsoft Actually Isn't Considering Salesforce Bid

Microsoft, despite a recent report to the contrary, is not considering a bid to acquire Salesforce.com, according to a report Thursday from Reuters, which cited two sources familiar with the matter.

According to Reuters' sources, Microsoft thinks a Salesforce acquisition would be too expensive right now, but may consider making a bid "in the long term."

Salesforce had market capitalization of just under $49 billion at the close of trading Friday.

[Related: Microsoft Wasn't Mystery Suitor For Salesforce, But Is Now Reportedly Considering Bid]

It's the latest twist in a drama that began in late April, when Bloomberg reported that Salesforce had been approached by a suitor and had hired financial advisers to either fight them off or facilitate a deal. Bloomberg reported this week that Microsoft wasn't the initial suitor but was mulling a bid for Salesforce.

Salesforce shares soared in the wake of both reports, and trading on the San Francisco-based vendor's shares was temporarily halted in both cases. Salesforce shares are still up 8 percent since the initial report.

Microsoft partners who spoke to CRN like the idea of bringing Salesforce into the fold.

Acquiring Salesforce would benefit customers and would be a great deal for Microsoft, provided the price is right, John Gilham, principal cloud architect at Agile IT, a San Diego-based Microsoft partner, said in an email.

"Salesforce customers would gain greater integration with enterprise systems powered by Microsoft," Gilham said. "Microsoft would also build on its cloud-first strategy from a market position perspective, to show internal and external stakeholders they are all in with the cloud."

Salesforce, as one of the first "born in the cloud" vendors, has more experience than Microsoft in delivering subscription apps to customers over the Internet. Salesforce's CRM software is also considered superior to Microsoft's offerings in the marketplace, Microsoft partners said.

Some Microsoft partners said they believe that bringing Salesforce into the fold could help it target new types of customers, like chief marketing officers, which are becoming increasingly involved in IT purchasing decisions.

Salesforce has moved aggressively into marketing automation software in recent years, and it has also gone to great lengths to embrace mobility, ensuring its SaaS apps work seamlessly with all the major device platforms.

If Microsoft CEO Satya Nadella is serious about reshaping the company around cloud and mobility, Salesforce would appear to check both boxes. And with more than $95 billion in free cash and assets, Microsoft has the wherewithal to pull off such a deal.

The Reuters report could be an indication that Microsoft got wind of Salesforce's asking price and decided not to continue talking. Or it could be the first of many coming leaks as representatives from both vendors hammer out the details of what would be the biggest software acquisition in history.

PUBLISHED MAY 8, 2015