Five9 Looks to the Future After Rejection of Purchase by Zoom

Call center company Five9 (News - Alert) recently reiterated its positive future as a standalone company in the wake of the collapse of a purchase deal by videoconference company Zoom. The company said it is well positioned to capitalize on favorable market dynamics and the enterprise opportunities head.

“We had the opportunity to engage extensively with our shareholders since our transaction announcement,” said Rowan Trollope, Chief Executive Officer of Five9, in a statement issued this week. “We greatly appreciate their feedback and confidence in Five9’s future prospects and share their views regarding the significant potential for value creation as a standalone company.”

In July of this year, Zoom had made an offer to purchase the company in an all-stock purchase for $14.7 billion, one of its biggest deals ever. The purchase of Five9 “presented an attractive means to bring to our customers an integrated contact center offering,” Eric Yuan, Zoom’s founder and CEO, wrote in a blog post. Zoom had hoped the acquisition would enhance its presence with customers and allow it to accelerate long-term growth opportunities in the hybrid work sector. Zoom had previously been a partner to Five9.

Ultimately, Five9 shareholders voted the deal down. The merger plan was ultimately “terminated by mutual agreement” between the two companies.

Zoom's lack of willingness to add a cash element to its offer to purchase and rely solely on a stock transaction backfired after the videoconference giant’s shares dropped by as much as 29 percent in the weeks following the announcement of the deal, likely on concerns that employees will soon return to physical offices as the COVID-19 pandemic wanes, eroding its future business, according to Reuters.

Going forward as a standalone company, Five9 notes that it is well positioned as customers focus on business agility in the move to the cloud and seek artificial intelligence-driven automation to increase efficiency in the contact center. The resulting savings are especially appealing to larger enterprises, which need to scale efficiently.

Edited by Luke Bellos