The Beginning of the End for Benioff, or BAU at Salesforce HQ?

The recent acquisition of Salesforce shares by Elliott Investment Management, followed by the news of the company's board being overhauled, raises a valid question: is Marc Benioff on his way out?

This week, news broke that activist investor group Elliott Investment Management L.P. had taken-up a multi-Billion-dollar stake in Salesforce . It has been reported this morning that Elliott is seeking a major overhaul of its board of directors.

Our Director, Lewis Steadman , feels that this could be the beginning of the end for one time, want-away Salesforce leader, Marc Benioff . Rumour has it, that Elliot is preparing to present major reforms to the Salesforce board, suggesting he would like to replace the old guard with a more diverse group.

Elliott is an investment group, known for their aggressive tactics, often driving massive change in the boardroom. Just ask? 荷商葛蘭素史克藥廠 (GSK) and SSE Renewables , for their take on Elliot, when they unveiled some pretty aggressive tactics to make snr changes at exec level.

As reported, Elliott believes CRM has not taken advantage of its position as a dominant player in the market and has fallen behind its competitors in terms of profitability. With Elliott's latest stake purchase, many anticipate that Salesforce management will be under significant pressure to increase profit margins and improve operational efficiency.

So are the rumours true? As board nominations approach, are 'tensions heating up' at Salesforce?

First off, who is Elliot management?

• With roots dating back to 1977, Elliott Investment Management L.P. and its affiliates are among the oldest fund managers of their kind.
• As of June 30, 2022, Elliott manages approximately $55.7 billion in assets, employing 499 people in its Florida headquarters and affiliated offices around the world, of whom nearly half are dedicated to portfolio management, analysis, trading, and research.
• In addition to private equity and private credit, Elliott covers distressed securities, non-distressed debt, hedge/arbitrage, real estate-related securities, commodities trading, and portfolio volatility management.

Upcoming board nominations at Salesforce?

We do not dispute that Salesforce could benefit from some fresh faces on its board, but what are the implications for #MarcBenioff in the long run? Could a potential reshuffle be the turning point for Benioff?

Reports indicate that Elliott is likely to nominate candidates for the Salesforce board ahead of February 12th. This raises the question of who could be removed from the board. Could Elliott be planning to remove long-term board members from Salesforce? Members who have worked closely with Benioff for many years...

As many know, Elliott has long invested in technology companies and has reached settlements for board seats with companies such as Pinterest, Twitter and eBay in the past. As a result, preparing a list of candidates who can be nominated is not an unexpected revelation.

Our opinion...

Three days ago, our director, Lewis asked his network on LinkedIn, 'Is Elliot's multi-billion dollar position in Salesforce the beginning of the end for Marc Benioff?'

Well, it looks like it could be!

Elliot is about to present significant reforms to the Salesforce board, and rumour has it that he intends to replace the old with a new more diverse group. As of yet, Salesforce has not commented on this subject, although several new members are rumoured to be nominated. Was this convenient timing, a retaliation against Elliot, or a countermeasure against Elliot?

Now it’s important to remember these are all rumours, and we’re merely speculating. However, right now the rumour is that Elliot plans to replace several of the older faces at Salesforce, now that means that the Advisory board, could be under immediate threat, and not the Exec board.

The Exec board run the company, and this is where famous names like Benioff, Parker Harris and Taylor reside. However, if Elliot was to shuffle the Advisory board, the group that put their opinions to the Leadership/Exec team, things could get very interesting, quickly!

Could this be?Elliot’s way of removing the existing Exec teams fan club and replacing them with a pro-change advisory board, that could spell the end of the current set-up.

Something of a coup!