NEW YORK, Feb. 28, 2022 /PRNewswire/ -- JANA Partners LLC
today sent the following letter to the Zendesk (NYSE: ZEN) Board of
Directors:
February 28, 2022
Board of Directors
Zendesk, Inc.
989 Market Street
San Francisco, CA 94103
Members of the Board,
At Friday's extraordinary shareholder meeting, Zendesk's
board received the lowest level of support of any disclosed
deal-related shareholder vote (buyer or seller) in the Russell 3000
in the last 20 years (and possibly ever), garnering only 9%
support (which would have been even lower excluding the roughly 3%
held by management and other insiders).1
This unprecedented rejection of the board's most consequential
strategic decision in recent memory comes as no surprise, as we
believe it was obvious the Momentive acquisition was flawed from
the start. Despite the collapse in Zendesk's share price caused by
the announcement of the transaction, widespread rebuke from
analysts and investors alike, opposition from independent proxy
advisory services and insurmountable odds of winning support, the
board nevertheless proceeded full steam ahead in its attempt to
acquire Momentive – burning tens of millions of dollars of
shareholder capital in the process.
We believe it could not be any clearer that Zendesk's board
is disengaged and totally out of touch with shareholder priorities,
lacks the requisite skillset to govern the company on their behest
and/or simply does not care enough to consider them.
Thanks to a CNBC report on Friday by David Faber, we have now also learned
that Zendesk's board appears to condone unprofessional acts of
hostility against dissenting viewpoints.
We believe sending an expletive-laden e-mail lashing out at a
highly respected, well credentialed CNBC contributor is
unacceptable, especially coming from Zendesk's lead independent
director, the most powerful independent shareholder representative
on the board. Unfortunately for shareholders, this appears to be
part of a pattern of hostility towards other points of
view.
We believe Zendesk requires either significant board change, or
in the absence of such change, should be sold. With the Momentive
chapter finally in the rearview mirror, we look forward to making
the case for shareholders to vote the WHITE proxy card at the
Zendesk 2022 annual meeting.
Sincerely,
Barry Rosenstein
Managing Partner
JANA Partners LLC
Important Information
JANA Partners LLC, JANA Special Situations Management, LP,
Barry Rosenstein ("collectively
JANA"), Quincy Allen, Felicia Alvaro, Jeff
Fox and Scott Ostfeld
(collectively and together with JANA, the "Participants") intend to
file with the Securities and Exchange Commission (the "SEC") a
definitive proxy statement and accompanying form of WHITE proxy to
be used in connection with the solicitation of proxies from the
stockholders of Zendesk, Inc. ("Zendesk" or the "Company") in
connection with the Company's 2022 annual meeting of stockholders
(the "2022 Annual Meeting"). All stockholders of the Company are
advised to read the definitive proxy statement and other documents
related to the solicitation of proxies, each in connection with the
2022 Annual Meeting, by the Participants when they become
available, as they will contain important information, including
additional information related to the Participants. The definitive
proxy statement and an accompanying WHITE proxy card will be
furnished to some or all of the Company's stockholders and will be,
along with other relevant documents, available at no charge on the
SEC website at http://www.sec.gov/.
Information about the Participants and a description of their
direct or indirect interests by security holdings is contained in a
Schedule 14A filed by the Participants with the SEC on February 16, 2022. This document is available
free of charge from the source indicated above.
Disclaimer
This material does not constitute an offer to sell or a
solicitation of an offer to buy any of the securities described
herein in any state to any person. In addition, the discussions and
opinions in this letter and the material contained herein are for
general information only, and are not intended to provide
investment advice. All statements contained in this letter that are
not clearly historical in nature or that necessarily depend on
future events are "forward-looking statements," which are not
guarantees of future performance or results, and the words
"anticipate," "believe," "expect," "potential," "could,"
"opportunity," "estimate," and similar expressions are generally
intended to identify forward-looking statements. The projected
results and statements contained in this letter and the material
contained herein that are not historical facts are based on current
expectations, speak only as of the date of this letter and involve
risks that may cause the actual results to be materially different.
Certain information included in this material is based on data
obtained from sources considered to be reliable. No representation
is made with respect to the accuracy or completeness of such data,
and any analyses provided to assist the recipient of this material
in evaluating the matters described herein may be based on
subjective assessments and assumptions and may use one among
alternative methodologies that produce different results.
Accordingly, any analyses should also not be viewed as factual and
also should not be relied upon as an accurate prediction of future
results. All figures are unaudited estimates and subject to
revision without notice. JANA disclaims any obligation to update
the information herein and reserves the right to change any of its
opinions expressed herein at any time as it deems appropriate. Past
performance is not indicative of future results. JANA has neither
sought nor obtained the consent from any third party to use any
statements or information contained herein that have been obtained
or derived from statements made or published by such third parties.
Except as otherwise expressly stated herein, any such statements or
information should not be viewed as indicating the support of such
third parties for the views expressed herein.
1 Historical voting information for last 20
years per ISS. Zendesk insider ownership per the Joint Proxy
Statement filed January 7, 2022.
Contact: IR@janapartners.com
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SOURCE JANA Partners LLC