Beloved customer service and customer feedback
brands will create powerful new Customer Intelligence company that
enables businesses to build more meaningful relationships
Combination expected to be growth accretive by
2023 and accelerate Zendesk’s revenue plan to $3.5 billion in
2024
Zendesk (NYSE: ZEN) and Momentive (NASDAQ: MNTV) have entered
into a definitive agreement under which Zendesk will acquire
Momentive, including its iconic SurveyMonkey platform. The terms of
the transaction provide for Momentive stockholders to receive 0.225
shares of Zendesk stock for each share of Momentive stock, a ratio
which represents an implied value of approximately $28 per
outstanding share of Momentive stock based on the 15-day volume
weighted average price of Zendesk common stock up to and including
October 26, 2021.
Zendesk expects the combination to be growth accretive in its
first full operating year and accelerate Zendesk’s revenue plan to
$3.5 billion in 2024, one year ahead of its previous target. The
companies’ respective sizable customer bases and complementary
capabilities are expected to provide significant opportunity for
joint product adoption and increasing Momentive’s enterprise
traction. Zendesk will reinvest savings from scale efficiencies
into compelling growth opportunities to support the combination.
Upon the close of the transaction, Momentive CEO Zander Lurie will
continue to lead Momentive’s strong management team.
“The SurveyMonkey brand is iconic and we’ve admired their
business from afar since the inception of Zendesk. They truly
democratized an industry—almost everyone in the world has responded
to one of their surveys at some point,” said Mikkel Svane, CEO
& Founder, Zendesk. “We’re very excited to have them join the
Zendesk mission along with Momentive’s market research and insights
products and together create a powerful new Customer Intelligence
company. We will deliver a rich, colorful picture of every customer
so businesses really understand their customers and can build more
authentic relationships.”
“We look forward to combining with Zendesk to advance our
mission and accelerate our long-term growth strategy,” said Zander
Lurie, CEO, Momentive. “This is a testament to the strength of our
agile products and talented team. Zendesk and Momentive share a
culture centered around our people, our communities and the
customers we serve. The synergies between our companies are
proximate and compelling. We are uniquely positioned to make
Customer Intelligence a reality while delivering significant
value for our shareholders.”
Acquisition to Create Powerful New Customer Intelligence
Company
In today’s digital-first economy, it is imperative to build more
meaningful relationships with customers. Meaning comes from a deep
understanding of the customer and their experiences. Although
businesses often have an endless supply of data, they lack
actionable and personalized customer intelligence. Instead,
businesses are left with a picture of the customer that is one
dimensional, impersonal and incomplete.
Zendesk pioneered the ability to respond to what customers say
and do, making it easier to deliver superior customer service.
Momentive is a leader in capturing how customers think and feel,
helping companies make critical decisions quickly and
confidently.
With Momentive, Zendesk will create what businesses really
need—a customer intelligence company that connects what customers
say and do, with how they think and feel. The combination will give
businesses the ability to:
- Listen to your customers: Collect critical information
about customer needs, experiences and expectations
- Develop a rich picture: Bring a customer into focus by
combining transactional data with market research and insights for
the context to truly understand them
- Act on insights: Empower teams to take action with the
full breadth of data about their customers as well as feedback and
market insights to improve customer interactions
Transaction Terms
Following a comprehensive review, the boards of directors of
Zendesk and Momentive have approved the transaction.
The terms of the transaction provide for Momentive stockholders
to receive 0.225 shares of Zendesk stock for each share of
Momentive stock, a ratio which represents an implied value of
approximately $28 per outstanding share of Momentive stock based on
the 15-day volume weighted average price of Zendesk common stock up
to and including October 26, 2021. Upon closing of the
transaction, Zendesk stockholders will own approximately 78% of the
combined company and Momentive stockholders will own approximately
22% of the combined company. The transaction, which is anticipated
to close in the first half of 2022, is subject to approval by
Zendesk stockholders and Momentive stockholders, the receipt of
required regulatory approvals and other customary closing
conditions. The transaction is intended to qualify as a tax-free
reorganization for U.S. federal income tax purposes.
Zendesk has published a presentation to provide an overview of
the transaction, available on both Zendesk and Momentive’s investor
relations websites. Additional details and information about the
terms and conditions of the transaction will be available in
Current Reports on Form 8-K to be filed by Zendesk and Momentive
with the Securities and Exchange Commission.
Quarterly Financial Results
In separate press releases issued today, Zendesk announced
financial results for the third quarter of 2021 and Momentive
announced preliminary results for its third quarter of 2021.
Momentive will issue a press release to share its full third
quarter financial results on November 9, 2021.
Conference Call and Webcast
Today at 2:00 p.m. (PT) / 5:00 p.m. (ET), Zendesk will host a
conference call to discuss its Q321 earnings and the transaction.
The live video webcast can be accessed through Zendesk investor
relations website at https://investor.zendesk.com. A replay of the
webcast will be available for 12 months.
Advisors
Goldman Sachs & Co. LLC is serving as lead financial advisor
and Centerview Partners LLC is also serving as financial advisor to
Zendesk. Hogan Lovells US LLP is serving as legal counsel to
Zendesk. Allen & Company LLC and J.P. Morgan Securities LLC are
serving as equal lead financial advisors and Wilson Sonsini
Goodrich & Rosati Professional Corporation is serving as legal
counsel to Momentive.
About Momentive
Momentive (formerly SurveyMonkey) is a leader in agile
experience management, delivering powerful, purpose-built solutions
that bring together the best parts of humanity and technology to
redefine AI. Momentive products, including GetFeedback,
SurveyMonkey, and its brand and market insights solutions, empower
decision-makers at 345,000 organizations worldwide to shape
exceptional experiences. More than 20 million active users rely on
Momentive to fuel market insights, brand insights, employee
experience, customer experience, and product experience.
Ultimately, the company’s vision is to raise the bar for human
experiences by amplifying individual voices. Learn more at
www.momentive.ai.
About Zendesk
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. Zendesk products are
built with love to be loved. The company was conceived in
Copenhagen, Denmark, built and grown in California, taken public in
New York City, and today employs more than 5,000 people across the
world. Learn more at www.zendesk.com.
Additional Information and Where to
Find It
This communication relates to a proposed business combination
transaction between Zendesk and Momentive. In connection with the
proposed transaction, Zendesk intends to file with the Securities
and Exchange Commission (the “SEC”) a registration statement on
Form S-4 that will include a joint proxy statement of Zendesk and
Momentive and that also will constitute a prospectus of Zendesk
with respect to shares of Zendesk’s common stock to be issued in
the proposed transaction (the “joint proxy statement/prospectus”).
The definitive joint proxy statement/prospectus (if and when
available) will be delivered to Zendesk’s stockholders and
Momentive’s stockholders. Each of Zendesk and Momentive may also
file other relevant documents regarding the proposed transaction
with the SEC. BEFORE MAKING ANY VOTING OR INVESTMENT DECISION,
INVESTORS AND SECURITY HOLDERS OF ZENDESK AND MOMENTIVE ARE URGED
TO READ THE REGISTRATION STATEMENT, JOINT PROXY
STATEMENT/PROSPECTUS AND ALL OTHER RELEVANT DOCUMENTS THAT ARE OR
WILL BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED
TRANSACTION, INCLUDING ANY AMENDMENTS OR SUPPLEMENTS TO THESE
DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN OR
WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
TRANSACTION.
Investors and security holders may obtain free copies of the
joint proxy statement/prospectus (if and when available) and other
documents that are filed or will be filed with the SEC by Zendesk
or Momentive through the website maintained by the SEC at
www.sec.gov. Copies of the documents filed by Zendesk with the SEC
also may be obtained free of charge at Zendesk’s investor relations
website at https://investor.zendesk.com or upon written request to
Zendesk, Inc. at 989 Market Street, San Francisco, CA 94103. Copies
of the documents filed with the SEC by Momentive will be available
free of charge by accessing Momentive’s investor relations website
at https://investor.momentive.ai or upon written request to
Momentive at investors@momentive.ai.
Participants in the
Solicitation
Zendesk, Momentive, their respective directors and certain of
their respective executive officers are participants in the
solicitation of proxies from the respective stockholders of Zendesk
and Momentive in respect of the proposed transaction. Information
about Zendesk’s directors and executive officers and their
ownership of Company common stock is set forth in Zendesk’s proxy
statement for its 2021 Annual Meeting of Stockholders on Schedule
14A filed with the SEC on April 2, 2021. Information about
Momentive’s directors and executive officers and their ownership of
Momentive’s common stock is set forth in Momentive’s proxy
statement for its 2021 Annual Meeting of Stockholders on Schedule
14A filed with the SEC on April 20, 2021. To the extent that
holdings of Zendesk’s or Momentive’s securities have changed since
the amounts printed in Zendesk’s or Momentive’s proxy statement,
such changes have been or will be reflected on Statements of
Changes in Beneficial Ownership on Form 4 filed with the SEC.
Additional information regarding the interests of the participants
in the proxy solicitations will be contained in the joint proxy
statement/prospectus when it becomes available. You may obtain free
copies of these documents as described in the preceding
paragraph.
Cautionary Statement Regarding
Forward-Looking Statements
This communication contains forward-looking statements,
including, among other things, statements regarding the anticipated
benefits of the proposed transaction, the anticipated impact of the
proposed transaction on the combined company’s business and future
financial and operating results, the expected amount and timing of
anticipated synergies from the proposed transaction, the
anticipated timing of closing of the proposed transaction and other
aspects of Zendesk’s or Momentive’s operations or operating
results. Words such as “may,” “should,” “will,” “believe,”
“expect,” “anticipate,” “target,” “project,” and similar phrases
that denote future expectations or intent regarding the combined
company’s financial results, operations, and other matters are
intended to identify forward-looking statements. You should not
rely upon forward-looking statements as predictions of future
events. The outcome of the events described in these
forward-looking statements is subject to known and unknown risks,
uncertainties, and other factors that may cause future events to
differ materially from the forward-looking statements in this
communication, including (i) the ability to complete the proposed
transaction within the time frame anticipated or at all; (ii) the
failure to realize the anticipated benefits of the proposed
transaction or those benefits taking longer than anticipated to be
realized; (iii) the risk that uncertainty about the proposed
transaction may adversely affect relationships with our customers,
partners, suppliers, and employees, whether or not the transaction
is completed; (iv) the effect of the announcement of the proposed
transaction on the ability of Zendesk or Momentive to retain and
hire key personnel; (v) the risk that disruptions from the proposed
transaction will harm Zendesk’s or Momentive’s business, including
current plans and operations; (vi) potential litigation related to
the proposed transaction and the resulting expense or delay; (vii)
the failure to obtain stockholder or regulatory approvals in a
timely manner or otherwise; (viii) the occurrence of any event,
change or other circumstances that could give rise to the right of
one or both of Zendesk or Momentive to terminate the proposed
transaction; (ix) the diversion of the attention of the respective
management teams of Zendesk and Momentive from their respective
ongoing business operations; (x) the ability of Zendesk to
successfully integrate Momentive’s operations and technologies;
(xi) the ability of Zendesk to implement its plans, forecasts and
other expectations with respect to its business after the
completion of the transaction and realize expected synergies; (xii)
the effect of uncertainties related to the COVID-19 pandemic on
U.S. and global markets, Zendesk’s or Momentive’s respective
business, operations, revenue, cash flow, operating expenses,
hiring, demand for their respective solutions, sales cycles,
customer retention, and their respective customers’ businesses and
industries; (xiii) risks relating to the market value of Zendesk’s
common stock to be issued in the proposed transaction; (xiv)
Zendesk’s ability to adapt its products to changing market dynamics
and customer preferences or achieve increased market acceptance of
its products; (xv) the intensely competitive market in which
Zendesk operates; (xvi) the development of the market for software
as a service business software applications; (xvii) Zendesk’s
substantial reliance on its customers renewing their subscriptions
and purchasing additional subscriptions; (xviii) Zendesk’s ability
to effectively market and sell its products to larger enterprises;
(xix) Zendesk’s ability to develop or acquire and market new
products and to support its products on a unified, reliable shared
services platform; (xx) Zendesk’s reliance on third-party services,
including services for hosting, email, and messaging; (xxi)
Zendesk’s ability to retain key employees and attract qualified
personnel, particularly in the primary regions Zendesk operates;
(xxii) Zendesk’s ability to effectively manage its growth and
organizational change, including its international expansion
strategy; (xxiii) Zendesk’s expectation that the future growth rate
of its revenues will decline, and that, as its costs increase,
Zendesk may not be able to generate sufficient revenues to achieve
or sustain profitability; (xxiv) Zendesk’s ability to integrate
acquired businesses and technologies successfully or achieve the
expected benefits of such acquisitions; (xxv) real or perceived
errors, failures, or bugs in Zendesk’s products; (xxvi) potential
service interruptions or performance problems associated with
Zendesk’s technology and infrastructure; (xxvii) Zendesk’s ability
to securely maintain customer data and prevent, mitigate, and
respond effectively to both historical and future data breaches;
(xxviii) Zendesk’s ability to comply with privacy and data security
regulations; (xxix) Zendesk’s ability to optimize the pricing for
its solutions; and (xxx) other adverse changes in general economic
or market conditions. The forward-looking statements contained in
this communication are also subject to additional risks,
uncertainties, and factors, including those described in Zendesk’s
and Momentive’s respective Quarterly Reports on Form 10-Q for the
period ended June 30, 2021 and other documents filed by either of
them from time to time with the SEC. The forward-looking statements
included in this communication are made only as of the date hereof.
Zendesk and Momentive do not undertake to update any
forward-looking statements made in this communication to reflect
events or circumstances after the date of this communication or to
reflect new information or the occurrence of unanticipated events,
except as required by law.
No Offer or Solicitation
This communication is not intended to and shall not constitute
an offer to sell or the solicitation of an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote of approval, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offer of securities
shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211028006219/en/
Stephanie Barnes Zendesk Communications
press@zendesk.com
Jason Tsai Zendesk Investor Relations ir@zendesk.com
Katie Miserany Momentive Communications
pr@momentive.ai
Gary J. Fuges, CFA Momentive Investor Relations
investors@momentive.ai
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