Verizon snatches up Zoom rival BlueJeans for under $500 million

A man stands next to the logo of Verizon at the Mobile World Congress in Barcelona

By Supantha Mukherjee and Munsif Vengattil

(Reuters) – Verizon Communications Inc on Thursday agreed to bag BlueJeans Network Inc, a rival of Zoom Video Communications Inc, for under $500 million because it appears to be like to be to be like to faucet into the recent-came across repute of video-conferencing apps.

Safe haven-in-predicament orders to fill the unfold of the recent coronavirus possess pushed firms to undertake news ways of doing alternate, leading to a surge in demand for video-conferencing apps a lot like Zoom, Cisco’s Webex and Microsoft’s Groups.

BlueJeans has about 15,000 enterprise clients and counts Facebook Inc and Customary Chartered among its most distinguished customers.

BlueJeans co-founder and Govt Chairman Krish Ramakrishnan mentioned the deal used to be negotiated trusty by the closing three months mainly the exercise of the company’s video-conferencing instrument.

“Right here’s the recent norm,” he mentioned, relating to how the deal used to be clinched in a virtual setup that also included the utilization of e-signatures.

The company is already a associate of Verizon, with the assembly app being offered to customers under the telecom company’s unified communications and collaboration companies and products.

“Verizon got a appropriate deal, but BlueJeans had been searching out for to sell itself for months,” Piper Sandler analyst James Fish mentioned.

The deal comes at a time when rival Zoom has seen its repute surge, with its everyday bright customers soaring to 200 million from about 10 million sooner than the pandemic began to unfold. Zoom has a market valuation of $42 billion.

Ramakrishnan mentioned BlueJeans used to be no longer in a position to bolster its gross sales and advertising and marketing within the past because it wished extra capital.

“Within the closing month, we have been rising, but we wished extra capital to grow and it used to be better for our customers and our staff that we joined forces with Verizon,” he mentioned.

The deal, first reported by the Wall Boulevard Journal, is anticipated to shut within the second quarter. Evercore and Goodwin Procter were advisers to BlueJeans, whereas Debevoise & Plimpton used to be adviser to Verizon.

Verizon would combine BlueJeans into its 5G product conception, aiming to faucet areas a lot like telemedicine and distance studying, mentioned Tami Erwin, community CEO of Verizon Enterprise.

(Reporting by Supantha Mukherjee and Munsif Vengattil in Bengaluru; Bettering by Saumyadeb Chakrabarty, Bernard Orr and Anil D’Silva)

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