Zendesk just agreed to sell itself for $10.2 billion - which is a far cry from the $17 billion it was offered earlier this year.
👉 Background: Zendesk is a tech company that creates customer service tools for companies, like live chat functions or help centres. Last year we found out Zendesk wanted to buy Momentive, the company behind SurveyMonkey.
👉 What happened: When it announced its intentions, Zendesk's and Momentive's shares tanked. Then earlier this year, a group of private equity investors came a-knocking with a $17 billion buyout offer... which the Z-crew rejected 👎.
👉 What else: Fast forward to now, and Zendesk just agreed to sell itself to a group of investors for $10.2 billion. Which, if my calculations are correct... Is a lot less than $17 billion.
💡When it comes to mergers or acquisitions, timing is a really critical factor - often just as important as the quality of the deal.
💡Often, companies can (and do) wait for election results, interest rate movements, or - in Zendesk’s case - other deals to close, before they settle in for a merger or acquisition.
💡Unforch for Zendesk, it received its $17bn offer around the same time it was trying to seal its Momentive deal. Now, it's had to make a tough call without any other better options available, and sell itself off.
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