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Thursday, October 21, 2021

Zoom’s $15 billion deal for Five9 is off

Five9 said in a news release that the deal had failed to garner enough support from its shareholders, and that the company would continue to operate independently.

By: New York Times |
October 1, 2021 12:46:59 pm
Small toy figures are seen in front of Zoom logo in this illustration picture taken March 15, 2021. (REUTERSFile Photo)

Written by David McCabe

Zoom’s roughly $15 billion acquisition of the call center software company Five9 fell apart Thursday evening, when the companies said they would terminate a deal that had drawn national security scrutiny.

Five9 said in a news release that the deal had failed to garner enough support from its shareholders, and that the company would continue to operate independently. Allison Wilson, a spokesperson for Five9, said the company believed it would build on its “current proven momentum” as an independent firm.

Zoom CEO Eric S. Yuan said in a blog post that while the acquisition had been an opportunity for the company to expand, it “was in no way foundational to the success of our platform.” A spokesperson for Zoom, CJ Lin, said the company had no further comment.

The proposed deal between the companies, both based in California, had attracted government scrutiny. In August, the Justice Department pushed for a federal review to determine whether the deal “poses a risk to the national security or law enforcement interests of the United States,” according to a letter to the Federal Communications Commission. The agency said it was worried about the possibility of “foreign participation” in the transaction.

In December, a Zoom executive was indicted and accused of working with the Chinese government to disrupt online events held for the anniversary of the Tiananmen Square massacre.

This article originally appeared in The New York Times.

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