Momentive Represents a Strategic Opportunity
that Zendesk is Uniquely Positioned to Leverage to Drive Enhanced
Growth and Value for Shareholders
Continues to Strongly Recommend Shareholders
Vote “FOR” Proposal to Approve the Issuance of Shares of
Zendesk Common Stock in Connection with the Transaction at Upcoming
Special Meeting
Zendesk, Inc. (NYSE: ZEN or the “Company”) today posted on its
investor relations website, and filed with the Securities and
Exchange Commission, an investor presentation detailing the
significant value the Company believes its proposed acquisition of
Momentive Global Inc. (“Momentive”) will bring to shareholders,
customers and other stakeholders.
Highlights from the presentation include the following:
Key Takeaways
- Zendesk’s business has never been stronger – the Company is
ready for a strategic transaction.
- Momentive represents a strategic opportunity that Zendesk is
uniquely able to leverage, adding the next layer of growth and a
near doubling of its total addressable market.
- The compelling strategic logic of this transaction translates
into concrete financial benefits and clear added value for Zendesk
shareholders. The acquisition is projected to increase 2025 revenue
by $1.2 billion, 35% higher than Zendesk’s standalone plan, at a
higher growth rate and higher margins.
- Zendesk’s offer to acquire Momentive is the result of a
thorough and deliberative process by the full Zendesk Board of
Directors and management team to evaluate opportunities to
profitably grow the business.
- Zendesk struck this transaction at the right price, time and
currency to realize value for shareholders not otherwise attainable
through partnership or organic development.
Zendesk’s Established Track Record of Execution
- Zendesk has scaled considerably since its founding in 2007 and
through its IPO in 2014 to the present. Today it is able to handle
billions of customer interactions for over 100,000 customers.
- Zendesk is ranked by Gartner as the #1 provider for digital
customer service use cases and the youngest Leader in Gartner Magic
Quadrant.
- Revenue growth is accelerating year-over-year as Zendesk is
winning larger customers, increasing its net expansion rate and
growing free cash flow.
- The Company has consistently met or exceeded its revenue
guidance and equity analysts’ long-term expectations and is
confident in its future enhanced revenue opportunities with
Momentive.
- Having established this track record of growth, including
through a deliberate strategy to move up-market in enterprise, the
Momentive transaction now represents an opportunity to extend
Zendesk’s strategy to provide more value to customers, and
therefore add more value to the business, particularly through
customer intelligence.
Realizing Zendesk’s Vision through Customer
Intelligence
- This acquisition will generate value for Zendesk shareholders
by further differentiating both Zendesk’s and Momentive’s product
offerings as well as through greater global reach, cross-selling
opportunities and by nearly doubling Zendesk’s total addressable
market to more than $165 billion by 2025.
- Both Zendesk’s and Momentive’s existing product offerings will
be enhanced by adopting solutions from the other, deepening
relationships with customers.
- Momentive’s underlying asset of customer interactions,
sentiment and behavior data for current, as well as future,
customers significantly strengthens and differentiates Zendesk’s
value proposition in its core customer service market while
creating significant future opportunities.
- Zendesk expects to generate approximately $55 million in the
first wave of 2023 revenue synergies, growing to approximately $275
million in 2025. These are conservative initial projections based
on cross-selling existing products at existing prices to existing
customers of both companies.
- Zendesk sees significant additional revenue upside from the
introduction of new products, new pricing and packaging and
improved strategic positioning as a customer intelligence
platform.
- Zendesk’s Board has evaluated many M&A opportunities since
its IPO using a highly disciplined review process. The Board’s
independence, experience and thorough evaluation of the
transaction, with the assistance of its independent legal and
financial advisors, informed its unanimous decision to acquire
Momentive.
- Zendesk’s offer to acquire Momentive represents a reasonable
premium to win a competitive process relative to recent comparable
transactions.
The Zendesk Board of Directors continues to unanimously
recommend that all shareholders vote “FOR” the proposal approving the issuance of
Zendesk Common Stock in connection with the acquisition of
Momentive. If shareholders have questions or need assistance in
voting their shares, please contact the Company’s proxy solicitor,
MacKenzie Partners, Inc., at (800) 322-2885 Toll-Free or by email
at zenproxy@mackenziepartners.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 filed with the Securities and
Exchange Commission (the “SEC”) a registration statement on Form
S-4 (the “registration statement”) that includes a joint proxy
statement of Zendesk and Momentive and that also constitutes a
prospectus of Zendesk with respect to shares of Zendesk common
stock to be issued in the proposed transaction (the “joint proxy
statement/prospectus”). The definitive joint proxy
statement/prospectus and WHITE proxy card of Zendesk or WHITE proxy
card of Momentive, as applicable, have been sent to Zendesk
stockholders and Momentive 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 MOMENTIVE, ZENDESK AND THE
PROPOSED TRANSACTION.
Investors and security holders may obtain free copies of the
joint proxy statement/prospectus and other documents that are filed
or will be filed with the SEC by Zendesk or Momentive through the
SEC’s website (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
investor.momentive.ai or upon written request to Momentive at One
Curiosity Way, San Mateo, California 94403.
Cautionary Statement Regarding
Forward-Looking Statements
This communication may contain 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 Zendesk’s
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) current or
future 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 most recent Annual
Reports on Form 10-K and Quarterly Reports on Form 10-Q 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 of 1933, as
amended.
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.
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version on businesswire.com: https://www.businesswire.com/news/home/20220127005632/en/
Investor Contact: Jason Tsai, +1 415-997-8882 ir@zendesk.com
Additional Investor Contact: MacKenzie Partners, Inc. Dan Burch/Bob
Marese, +1-212-929-5500
dburch@mackenziepartners.com/bmarese@mackenziepartners.com Media
Contacts: Stephanie Barnes, +1 415-722-0883 press@zendesk.com John
Christiansen +1 415-618-8750 Robin Weinberg +1 212-687-8080 Sard
Verbinnen & Co Zendesk-SVC@sardverb.com
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