The deal is reported to be for $212 million.
Founded in 2007, San Francisco-based Heroku allows Ruby programmers to deploy their applications using Heroku to host them. The service has grown in popularity thanks to its competitive pricing, eliminating the need for developers to build their own servers to launch and host an application. Heroku hosts all kinds of apps, such as thosse written for the iPhone as well as for popular social media sites such as Facebook.
According to Heroku’s website, more than 106,000 apps currently live on its servers.
Salesforce.com dominates the customer relationship management (CRM) market and is now looking to get more software developers to host their applications with the company, encouraging the design of more apps that will work with Salesforce, providing additional value to their customers.
“The next era of cloud computing is social, mobile and real-time. I call it Cloud 2,” said Marc Benioff, salesforce.com’s chairman and CEO. “Ruby is the language of Cloud 2.”
In addition to the $212 million in cash, Salesforce will pay $27 million in stock to Heroku employees as well as $10 million in cash for unvested Heroku shares.
Salesforce has long term revenue plans for Heroku, stating that it doesn’t expect Heroku to add to its revenue in the year ending Jan. 31, 2012. It expects the deal to trim fourth-quarter earnings by 2 cents per share and by 12 to 13 cents per share in fiscal 2012.
The deal is expected to close during salesforce.com’s fiscal fourth quarter, which ends Jan. 31. Shares rose $2.97, or 2 percent, to $148.21 in midday trading.
