Advisory Firm ISS Urges Five9 (FIVN) to Reject Zoom (ZM) Offer

September 17, 2021 9:59 AM EDT
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Institutional Shareholder Services (ISS), the Maryland-based advisory firm, urged Five9 (NASDAQ: FIVN) to reject the $14.7 billion takeover proposal from Zoom Video Communications (NASDAQ: ZM).

ISS says that the deal would provide FIVN shareholders with “a more volatile stock whose growth prospects have become less compelling as society inches towards a post-pandemic environment,” ISS analysts wrote in a client note.

In July this year, ZM announced a deal to acquire FIVN for $14.7 billion to build the customer engagement platform of the future.

“It has always been Five9’s mission to make it easy for businesses to fix that problem and engage with their customers in a more meaningful and efficient way. Joining forces with Zoom will provide Five9’s business customers access to best-of-breed solutions, particularly Zoom Phone, that will enable them to realize more value and deliver real results for their business. This, combined with Zoom’s ‘ease-of use’ philosophy and broad communication portfolio, will truly enable customers to engage via their preferred channel of choice,” said Rowan Trollope, Chief Executive Officer of Five9.

However, ISS claims that Zoom shares have failed to rally following their conference earlier this month. On the other hand, the outlook for Five9 as an independent company has improved in the past few months, analysts argue.

Shares of Zoom are down about 20% since announcing the deal. On the other hand, shares of FIVN are up 2.5% today on the ISS note.

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