Zoom Video Communications Inc. late today announced that it has entered a deal to acquire cloud contact center provider Five9 Inc. in an all-stock transaction valued at $14.7 billion.

Founded in 2001, Five9 offers cloud software for the enterprise contact center market with a software-as-a-service platform that has seen rapid growth over the last year thanks to the COVID-19 pandemic. Designed to help organizations move operations from legacy on-premise data centers to the cloud, the company pitches its offering as providing business reliable, secure, compliant and scalable cloud contact center software that improves customer experiences.

In its first quarter, Five9 reported revenue up 45% over the first quarter of 2020, to $137.9 million. Net income of $16.1 million or 23 cents per diluted share also rose 45%. Analysts had been predicting a profit of 13 cents per suare on revenue of $122.5 million.

Speaking to SiliconANGLE in May, Five9 Chief Executive Officer Rowan Trollope (pictured) said a big driver in the company’s growth has been the cloud transition in general. “People have seen the writing on the wall and are now seeing that’s the way they should be heading,” Trollope said. “Customer experience has also become a bigger priority. Part of that is generational; new consumers have higher expectations for customer services.”

Even as Five9 is now the subject of acquisition, the company itself has made acquisitions in the past. Five9 acquired Inference Solutions Inc. in October, which added virtual agents to its product line. Trollope credits that acquisition as a big factor in its recent success.

The acquisition by Zoom will see Five9’s contact center-as-a-service solution combined with Zoom’s communication platform to “transform how businesses connect with their customers, building the customer engagement platform of the future.”

“We are continuously looking for ways to enhance our platform and the addition of Five9 is a natural fit that will deliver even more happiness and value to our customers,” Eric S. Yuan, founder and CEO of Zoom, said in a statement. “We believe this acquisition creates a leading customer engagement platform that will help redefine how companies of all sizes connect with their customers.”

Zoom’s acquisition of Five9 is the latest for a company best known for its online meeting service as it seeks new growth opportunities after its successful initial public offering in June 2020. Zoom acquisitions have included secure messaging and file-sharing service Keybase Inc. in May and AI-based real-time translation and transcription software provider Karlsruhe Information Technology Solutions GmbH in June.

The deal is subject to shareholder approval and is expected to close in the first half of 2022. The acquisition by an all-share deal offers a decent premium for Five9 given its market capitalization as of the close of regular trading on Friday was $11.9 billion.

Photo: SiliconANGLE