Zoom, Five9 Agree To End Nearly $15B All-Stock Deal

Five9 Inc. shareholders voted down on Thursday the call center software firm's $14.7 billion sale to Zoom Video Communications Inc., scuttling what would have been the virtual conferencing giant's biggest-ever acquisition, Subrat Patnaik reported for Reuters.

Photo Insert: The development comes after proxy advisory firm Institutional Shareholder Services earlier this month recommended Five9 shareholders vote against the deal, citing growth concerns.

The development comes after proxy advisory firm Institutional Shareholder Services earlier this month recommended Five9 shareholders vote against the deal, citing growth concerns.

"The agreement did not receive the requisite number of votes from Five9 shareholders to approve the merger with Zoom," San Ramon, California-based Five9 said on Thursday. "Five9 will continue to operate as a standalone publicly-traded company."

Zoom became a household name and an investor favorite in the year since the pandemic, as businesses and schools adopted its services to hold virtual classes and office meets.

But with rapid vaccination and life creeping back to normal, Zoom was looking to rake in revenue beyond its core video conferencing business that faces stiff competition from rivals Microsoft Corp., Cisco Systems Inc., and Salesforce's Slack.

Last week, analysts said the deal may be delayed by a US Justice Department-led committee review but it was unlikely to be scrapped. A US Justice Department-led committee was also reviewing Zoom's proposed all-stock deal to buy Five9, according to a letter filed with US regulators.

The Aug. 27 letter filed with the Federal Communications Commission said the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector was reviewing to see if the deal "poses a risk to the national security or law enforcement interests."

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