Zoom Video Communications, the video conferencing start-up whose services became globally popular during the coronavirus pandemic, has agreed a deal to buy cloud software provider Five9 for about $14.7bn in its first major acquisition.
The all-stock transaction values Five9 shares at $200.28 with shareholders in the company set to receive 0.5533 shares of Zoom class A common stock. Shares in Five9 closed at $177.60 on Friday.
Zoom’s deal with Five9, which offers call centres via cloud computing, will help expand the company’s Zoom Phone offering. It comes as the San Jose, California-based company prepares for a post-pandemic slowdown following its explosive growth in 2020.
In the 12 months to January 31, Zoom’s annual sales quadrupled to $2.65bn and its share price has risen more than 400 per cent since the start of 2020, though it remains below its October high.
Eric Yuan, Zoom’s chief executive, has been eager to capitalise on the huge audience that signed up to its services last year as millions of people were forced to log into virtual meetings during lockdowns. He said this year that the company would move to expand its range of communications services.
“We are continuously looking for ways to enhance our platform, and the addition of Five9 is a natural fit that will deliver even more happiness and value to our customers,” Yuan said in a statement on Sunday.
While Zoom is predominantly known for its video conferencing services, it has been promoting various office collaboration products including Zoom Phone, a cloud phone system, and its conference software, Zoom Rooms.
Five9’s software is used by a number of companies that Zoom is seeking to displace, including Microsoft Teams and Salesforce. In 2017, Mike Burkland, now the company’s chair, told Barron’s that he expected Five9 to be purchased by one of its larger partners.
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July 19, 2021 at 10:29AM
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Zoom buys cloud call centre company Five9 for almost $15bn - Financial Times
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