Zoom Buys Five9 In $14.7B All-Stock Deal

Zoom, the videoconferencing company whose growth was supercharged by the pandemic over the past year, will buy the cloud call center company Five9 in an all-stock deal valued at about $14.7 billion, the Associated Press (AP) reported.

That is far greater than Zoom’s market valuation a little over two years ago when it went public for slightly more than $9 billion.

Zoom founder and CEO Eric Yuan said in a blog post Sunday that the acquisition will accelerate the company’s long-term growth by adding the $24 billion contact center market.

That will give Zoom greater exposure to more business clients.

Yuan added that it also the deal also complements the Zoom Phone, a cloud phone system that is seeing strong demand.

The size of the deal would have seemed unthinkable when Zoom Video Communications Inc. went public in early 2019 before it became a household name.

With the arrival of the pandemic and a global shift to working from home, Zoom is everywhere. Its stock, which could be bought for less than $70 each at the start of 2020 just before the detection in the US of COVID-19, is now worth five times that.

There were indications that Zoom might be in the hunt for acquisitions early this year that would accommodate more growth. In January, the company announced a secondary offering of shares that could raise up to $1.5 billion for, among other things, “acquisitions or strategic investments.” Shares dipped almost 4% at the opening bell Monday, trading for $348.88.

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