What happened? On Sunday, July 18, 2021, Zoom Video Communications, Inc. announced its intention to acquire Five9, Inc.1 Both cloud computing stocks are currently in the WisdomTree Cloud Computing Fund, and this deal marks a continuation of M&A activity in the cloud industry.

What is the problem? It is a $ 14.7 billion stock-only transaction in which Five9 shareholders will receive 0.5533 shares of Zoom for each share of Five9. The implied selling price per share is $ 200.28, a 13% premium over Five9’s closing price of $ 177.60 on Friday, July 16. The bonus is on that lower end of the cloud acquisition rewards we’ve been tracking, and about which we wrote after the rebalancing of the WCLD in February.

What’s the motive? Most people are more familiar with Zoom than Five9. During the COVID-19 pandemic, Zoom became a household name as its video conferencing platform became one of the standard options for connecting …



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