Zoom Video Communications Inc (ZM.O) announced a $14.7 billion all-stock deal to buy cloud-based call center operator Five9 Inc (FIVN.O) in its largest-ever acquisition, as competition intensifies in its core videoconferencing sector, APA reports citing Reuters.
The teleconferencing services provider has become a household name and investor favorite in the year since the coronavirus pandemic, as businesses and schools adopted its services to hold virtual classes, office meets and socialise.
The San Jose, California-based company is now shifting focus to its two-year-old cloud-calling product Zoom Phone and conference-hosting product Zoom Rooms as bigger players Facebook (FB.O) and Alphabet's (GOOGL.O) Google amp up their video products.
"The acquisition is expected to help enhance Zoom’s presence with enterprise customers and allow it to accelerate its long-term growth opportunity by adding the $24-billion contact center market," Zoom said in a statement on Sunday.
The acquisition will complement Zoom Phone service, an alternative to legacy phone offerings, by adding Five9's business customers and combining its contact centre software to optimize customer interactions across channels, it added.
Five9's customers include Under Armour (UAA.N), Lululemon Athletica Inc (LULU.O) and Olympus Corp (7733.T), according to its website.
Five9 will become an operating unit of Zoom and its chief executive, Rowan Trollope, will become a president of the company, staying on as chief of the unit after the deal, which is expected to close in the first half of 2022, it said.
Under the pact, approved by the boards of both companies, Five9 stockholders will receive 0.5533 shares of Class A common stock of Zoom for each share of Five9, it added.