Video conferencing giant Zoom has abandoned its bid to buy cloud software provider Five9 as part of a $14.7 billion (£10.8bn) deal announced in July.
The collapse of the deal comes just weeks after the US Department of Justice dialled up its investigation of the acquisition due to national security concerns.
Following a shareholder meeting organised by Five9, both companies decided to cancel the deal after a majority of investors opposed continuing with the merger.
Rowan Trollope, chief executive of Five9, said: “We had the opportunity to engage extensively with our shareholders since our transaction announcement. We greatly appreciate their feedback and confidence in Five9’s future prospects and share their views regarding the significant potential for value creation as a standalone company.”
Regulatory concerns surrounding what would have been Zoom’s largest acquisition to date emerged due to both companies ties to China and Russia. Five9 has operations in Russia, whilst Zoom depends on a large number of China-based developers.
Zoom chief executive Eric Yuan has since written in a blog post that Five9 “presented an attractive means to bring to our customers an integrated contact centre offering”, but “it was in no way foundational to the success of our platform nor was it the only way for us to offer our customers a compelling contact centre solution”.
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