Proxy advisor ISS to vote against Zoom-Five 9 deal over development questions

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File photo: In this image taken on March 19, 2020, you can see the shape of a small toy in front of the Zoom logo. Reuters / Dado Ruvik / Illustration

September 17, 2021

(Reuters) – Agency advisory firm Institutional Shareholder Services on Friday recommended a vote by shareholders against Zoom Video Communications Inc’s cloud-based call center operator Five9 Inc. for a $14.7 billion deal, due to growth concerns. ..

The merged company will have access to a larger market, but ISS said, “All-stock trading makes Five9’s shareholders a more volatile stock, whose growth prospects have weakened as society moves into a post-pandemic environment.” has reached. will be informed. “

Shares of Zoom have lost more than 20% of their value since the deal was announced on July 18, while Five9 is down nearly 5%.

Last year, pandemic winner Zoom, whose market share grew by nearly 396%, acquired the largest acquisition of Five9 in history to move beyond its core video conferencing services.

Earlier this month, the company announced improvements and enhancements to services such as the event lobby, chat and networking, with the hope that consumers will continue to use the platform for remote work.

However, ISS said the new additions did not reduce shareholder concerns about the ongoing trade termination. On the other hand, Five9’s outlook has improved since the acquisition announcement and could attract more bidders if the deal fails.

Zoom was not immediately available due to comments, but Five9 declined to comment.

Shares of Zoom fell about 18% this year and rose 2% in early trading. Five9 gained 2.5%.

(Reporting by Tiyashi Dutta in Bengaluru, Edited by Arun Koyur)

Proxy advisor ISS to vote against Zoom-Five 9 deal over development questions

source link Proxy advisor ISS to vote against Zoom-Five 9 deal over development questions

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