Zoom’s agreement to buy cloud contact center software company Five9 was scuttled on Thursday, after Five9 shareholders rejected the deal.
Zoom said in July that it was acquiring Five9 in an all-stock purchase for $14.7 billion, its first billion-dollar-plus purchase and, at the time, the second-biggest tech deal of the year.
A branch of the U.S. Department of Justice was reviewing the deal out of concern about potential foreign participation, according to a letter dated Aug. 27 that was sent to the Federal Communications Commission. But Zoom said last week, when news of the review was reported, that it still expected the deal to close in the first half of 2022.
Five9 shareholders were ultimately unsatisfied with the small premium that Zoom was set to pay. At the agreed-upon price, they were only going to receive a 13% bump in the value of their shares over where they were trading prior to the agreement. Given the momentum in cloud software and all the money investors have poured into Five9′s peers, a significantly higher premium was likely expected.