Call centre software provider Five9 Inc turned down Zoom Video Communications for the acquisition which was announced in July this year. Zoom had plans to leverage the client base of Five9 which counts more than 2000 with major players namely Under Armour, Lululemon Athletica Inc and Olympus Corp as customers. So, industry leaders see this as a major blow to Zoom's expansion plans in terms of its offering in the vast market, through the acquisition of $14.7 billion.
According to a letter filed with U.S. regulators, a committee formed by the US Justice Department was reviewing the acquisition deal pertaining to the national security concerns, though it was stated that the deal was unlikely to be scrapped down.
The deal stated that enabled by the acquisition, Five9 shareholders would have received 0.5533 Zoom shares. It was voted down by Five9 after the proxy advisory firm Institutional Shareholder Services (ISS) and Glass Lewis suggested the move expressing concerns over growth and dual-class shares. Interestingly, the shares of Five9 gained value by 19.3% since the announcement of the deal in July but fell by 1.1% on Thursday.