On Thursday, Zoom, and Five9 jointly agreed to scrap the merger agreement as the Zoom shares dropped by over 25% which lead Five9 shareholders to reject the offer.
In July, Zoom proposed a $14.7 billion deal to acquire Five9, a leading cloud data center software provider headquartered in the US. However, earlier this month proxy advisory firm Institutional Shareholder Services (ISS) and Glass Lewis suggested that Five9 shareholders vote against the deal due to the concerns in the company’s growth and dual-class shares.
As per the deal terms declared, the Five9 shareholders would have obtained 0.5533 Zoom share for each Five9 share.
Since the transaction was announced, the Five9 shares dropped to about and further saw a 1.9% decline following the news of the Zoom-Five9 merger call-off on Thursday. On the other hand, Zoom saw a gain of less than 1%.
California Company, Five9 creates cloud-based software using artificial intelligence that helps companies to interact with their client no matter what their language is, where they are from and what device they are on.
Some of Five9’s clients are Under Armour, Citrix, Lululemon, and Athena Health as stated on the website.
Zoom believes that their deal with Five9 would have helped the company extend its offerings to its profitable business and enterprise clients.
Eric Yuan, Zoom’s CEO said that the Zoom and Five9 merger deal would have been beneficial for both companies’ shareholders.
He further stated the contact center market remains a strategic priority for Zoom and we are confident in our ability to capture its growth potential.
According to the source, Zoom will still maintain the partnership with Five9 and also with other companies like Genesys, NICE inContact, Talkdesk, and Twilio.
Related: Zoom and Five9 $14.7 billion deal under review
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