Five9 and Zoom Video Communications mutually agreed to cancel their pending merger.
The agreement did not receive the requisite number of votes from Five9 shareholders to approve the merger with Zoom. Five9 will continue to operate as a standalone publicly traded company.
Zoom and Five9 will continue the partnership that was in place prior to the announcement, which includes support for integrations between their respective Unified Communications as a Service (UCaaS) and Contact Center as a Service (CCaaS) solutions and joint go-to-market efforts.
Zoom Video Communications agreed to acquire Five9, an intelligent cloud contact center provider, in an all-stock transaction valued at approximately $14.7 billion based on the closing price of Zoom common stock on July 16, 2021. Five9 stockholders will receive 0.5533 shares of Class A common stock of Zoom Video Communications, Inc. for each share of Five9.
The deal combines Five9’s Contact Center as a Service (CCaaS) solution with Zoom’s broad communications platform. Five9, which is based in San Ramon, California, reports $478 million in LTM revenue and 796 upmarket/enterprise customers.
Zooms says the acquisition will broaden its total addressable opportunities to include the $24 billion contact center market. Revenue for the first quarter of 2021 increased 45% to a record $137.9 million, compared to $95.1 million for the first quarter of 2020. GAAP gross margin was 56.6% for the first quarter of 2021, compared to 57.9% for the first quarter of 2020.
Five9's cloud contact center offers a suite of applications that allows management and optimization of customer interactions across many different channels.
“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,” said Eric S. Yuan, Chief Executive Officer and Founder of Zoom. “Zoom is built on a core belief that robust and reliable communications technology enables interactions that build greater empathy and trust, and we believe that holds particularly true for customer engagement. Enterprises communicate with their customers primarily through the contact center, and we believe this acquisition creates a leading customer engagement platform that will help redefine how companies of all sizes connect with their customers. We are thrilled to join forces with the Five9 team, and I look forward to welcoming them to the Zoom family.”
“Businesses spend significant resources annually on their contact centers, but still struggle to deliver a seamless experience for their customers,” said Rowan Trollope, Chief Executive Officer of Five9. “It has always been Five9’s mission to make it easy for businesses to fix that problem and engage with their customers in a more meaningful and efficient way. Joining forces with Zoom will provide Five9’s business customers access to best-of-breed solutions, particularly Zoom Phone, that will enable them to realize more value and deliver real results for their business. ”
Following the close of the transaction, Five9 will be an operating unit of Zoom and Rowan Trollope will become a President of Zoom and continue as CEO of Five9, reporting to Eric Yuan.
- Rowan Trollope joined Five9 as CEO in May 2018. Previously, he was SVP and General Manager of Cisco’s Applications Group and a member of the executive leadership team. Prior to Cisco, at Symantec Rowan was Group President Sales, Marketing, and Product Development, responsible for cloud security and the SMB market.
