January 23, 2022, 11:17

    Zoom’s pandemic hedge

    Zoom’s pandemic hedge

    NEW YORK, Dec 3 (Reuters Breakingviews) – Zoom Video Communications (ZM.O) is trying to figure out how to thrive post-pandemic. Its $14.7 billion diversification effort in buying call center software firm Five9 (FIVN.O) failed as Zoom’s stock plummeted read more , losing half its value in 12 months to $53 billion on Friday. An agreement with American Express Global Business Travel, announced Friday is a strange answer.

    GBT is merging with a special-purpose acquisition company backed by Apollo Global Management (APO.N) in a $5.3 billion deal. Zoom and other investors are chipping in $335 million in total alongside. The investment is partly a hedge if real-life meetings replace virtual ones. The price looks reasonable, at 10 times adjusted EBITDA, some 30% less than rival Amadeus IT (AMA.MC).

    Zoom may hope for more, like forging a close relationship and having its online events service collaborate with GBT’s conference business. Yet the two could have just pledged to work together without a Zoom investment. And Zoom shareholders may wonder if such a veer is a worrying signal. (By Robert Cyran)

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