Friday, July 22, 2022

Zendesk to Be Acquired

Reuters, in February:

Zendesk Inc (ZEN.N), the software company under activist shareholder pressure to abandon its $3.9 billion all-stock acquisition of the parent of online survey portal SurveyMonkey, said on Thursday it had rejected an acquisition offer from a consortium of private equity firms for as much $16 billion.

Zendesk (Hacker News):

Zendesk, Inc. (NYSE: ZEN) today announced it has entered into a definitive agreement to be acquired by an investor group led by leading global investment firms Permira and Hellman & Friedman LLC (“H&F”) in an all-cash transaction that values Zendesk at approximately $10.2 billion.


Zendesk started the customer experience revolution in 2007 by enabling any business around the world to take their customer service online. Today, Zendesk is the champion of great service everywhere for everyone, and powers billions of conversations, connecting more than 100,000 brands with hundreds of millions of customers over telephony, chat, email, messaging, social channels, communities, review sites and help centers.

Ron Miller:

But the SaaS market has shifted dramatically over the last few months, and Zendesk has been caught in the middle of it in a maelstrom of investor drama. Earlier this month, the company concluded it would stay independent, a move that caused the stock price to plunge.


For Zendesk, it gave unhappy investors a way to get some return on their investment[…]

It sounds like they aren’t profitable yet, and instead of raising more money to try to grow their way out of it, they went with a private equity firm that will likely cut spending/development and try to run it more efficiently. This is good for customers in so far as the service will likely stay around, but I would not expect to see a lot of improvements.


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