Results for Zoom Video Communications Inc.
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The U.S. Department of Justice has raised international security concerns in line with Zoom Video Communications’ plans to take over the Five9 cloud company, demanding a second review of the $ 14.7bn deal.
Mu letter at the Federal Communications Commission, the international security department said the inter-agency committee to review “foreign participation” in the U.S. telecommunications sector should assess whether the purchase of Zoom “is a threat to national security or law enforcement in the US”.
The FCC, the US telecommunications regulator, has been closely monitoring the deal, but the committee’s review adds another layer of legislation.
Zoom’s reliance on a large group of Chinese developers has raised questions over the future of China’s future. The company, based in San Jose, California, said no customer information was passed through its servers in Asia, although it admitted last year that it had compromised other transactions through China.
One of his Chinese counterparts was also found to have agreed with Chinese officials to ban video conferences commemorating the 1989 demonstrations in Tiananmen Square, even though it took place in the US. All of these cases have been the focus of the DoJ’s investigation.
The U.S. [the FCC] he is expected to adjudicate the request, ”the Justice Department said in a letter on August 27.
The DoJ’s letter comes as U.S. officials in the regions including antitrust, foreign exchange as well security law be bold in China’s economic situation in American companies, between good relations between Washington and Beijing.
Zoom said: “The availability of Five9 has certain legal rules for telecom. We have developed theaters and various operating agencies, and the process of approving this is happening as expected. We will continue to receive the necessary approvals to close the agreement in the first phase of 2022.”
In San Ramon, California, Five9 declined to comment.
Magnification make buying the Five9, which was announced in July, will be a sign of the company’s first major acquisition. All stocks share Five9 shares at $ 200.28 with investors to receive 0.5533 shares of Zoom class A common stock.
However, the high cost of Zoom’s assets and its subsequent backlog concerns have made the deal possible. The corporate price has dropped by 23% since the job was announced and now appreciates Five9 for $ 154 a share, much lower than its current $ 170 price target.
Institutional Shareholder Services, a licensed public consulting firm, has recommended that nine shareholders vote in their favor by citing concerns about the company’s growth as the general spread is declining.
“The unity of all parties is revealing [Five9] those who are sharing the growing stocks whose hopes of growth are not really appealing because the population is growing after the epidemic, ”the ISS wrote in a report released last week.
A spokesman for the party also warned of the political crisis that could result from “China’s major events” at Zoom.
The issue of a letter from the Department of Justice was first reported by the Wall Street Journal.