Zoom announced on Sunday that it would acquire Five9, a cloud contact center Software vendor, in an all-stock deal valued at $14.7 billion. The acquisition is Zoom’s first billion-dollar deal, and it comes as the company prepares for a post-pandemic world in which staff will return to work. According to FactSet, it’s the second-largest US tech deal this year, behind Microsoft’s planned $16 billion acquisition of Nuance Communications.
Zoom CEO Eric Yuan said, “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.” On Friday, Five9 had a market capitalization of $11.9 billion, or $177.60 per share. Five9 owners will receive 0.5533 Zoom Video Communications shares for each Five9 share, according to Zoom.
As Microsoft steps up competition in video chat with Teams, it also needs new revenue sources. The stock price of Zoom soared about 400% last year, but it has already slumped 36% since its October high. Since early 2020, Five9 has experienced fast growth as demand for call center technology that allows representatives to work from home has increased. Companies, particularly contact centers, had to adapt to cloud Software of all kinds quickly.