Zendesk, a software services firm, said that it would acquire Momentive Global, the owner of the famous SurveyMonkey platform, for roughly $4 billion (A$5.3 billion) in an all-stock transaction. Momentive stockholders will get 0.225 shares of Zendesk stock for every share of Momentive stock owned, implying a value of around US$28 per share at the time of launch.
Zendesk and its shares fell 16% in afternoon trade, while Momentive’s stock fell roughly 9% to US$22.70 per share. Momentive, which was previously known as Survey Monkey, went public in September 2018 for US$12 per share. Momentive, situated in San Mateo, California, was renamed early this year to broaden its range of experience management services.
Zendesk, a customer support software firm, has benefited from the epidemic as its business customers speed their digitalization. This will be the company’s largest purchase. We have a lot of clients that are the same. It’s potent. And we believe it will generate a whole new, richer picture of your clients,” Zendesk CEO Mikkel Svane told investors on Thursday. The transaction is scheduled to complete in the first half of 2022, subject to shareholders’ approvals from Zendesk and Momentive. A dramatic drop in stock prices has already failed all-stock transactions such as Zoom’s US$14.7 billion acquisition of software business Five9.
On Thursday, Zendesk also disclosed its quarterly sales, which increased 32% to $347 million. The contract with Momentive is expected to speed its revenue forecast to US$3.5 billion in 2024, one year faster than its earlier aim.