Mails Letter to Stockholders Outlining Opportunities for Value Creation as Part of Larger, Faster-Growing Organization
Momentive Global (NASDAQ: MNTV), an agile experience management company (formerly SurveyMonkey), today announced that it has filed a definitive proxy statement with the U.S. Securities and Exchange Commission in connection with the Special Meeting of Stockholders (the “Special Meeting”) that has been called to approve proposals relating to the Company’s previously announced transaction with Zendesk, Inc. (NYSE: ZEN).
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The Special Meeting will be held virtually via live webcast on February 25, 2022, beginning at 10:00 a.m. Pacific Time. Stockholders can virtually attend and vote at the Special Meeting by visiting www.cesonlineservices.com/mntv22_vm. To attend the Special Meeting, stockholders must pre-register at www.cesonlineservices.com/mntv22_vm by 10:00 a.m. Pacific Time on February 24, 2022.
The Momentive Board of Directors unanimously recommends that Momentive stockholders vote “FOR” all proposals relating to the proposed transaction with Zendesk.
Momentive also today announced that it will report fourth quarter and fiscal year 2021 financial results for the period ended December 31, 2021, after the market closes on Thursday, February 10, 2022. Due to the pending transaction with Zendesk, Momentive will not be holding a conference call to discuss these results.
In connection with the filing of the definitive proxy statement, Momentive will mail the following letter to stockholders:
Dear Fellow Momentive Stockholder:
In the upcoming weeks, you will be asked to make an important decision regarding the future of Momentive. On February 25th, Momentive is scheduled to hold a Special Meeting of Stockholders, where you will have the opportunity to approve our proposed combination with Zendesk. The Momentive Board of Directors undertook a comprehensive strategic review process before unanimously committing to the Zendesk transaction. Simply put, we believe the combination will maximize value for our stockholders.
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The Momentive Board is unanimous in its support of the transaction with Zendesk and its recommendation that stockholders vote “FOR” the combination for the following reasons:
The Transaction Maximizes Value for Momentive Stockholders
Combining with Zendesk delivers compelling financial benefits to Momentive and its stockholders. The transaction has an exchange ratio of 0.225, which represents an over 30% premium to the unaffected one-month, six-month and one-year historical exchange ratios of Momentive and Zendesk preceding October 6, 2021. The implied consideration value in the transaction, based on the transaction exchange ratio and Zendesk’s share price on January 3, 2022, represents an approximate 19% premium to Momentive’s unaffected 30-day volume weighted average price (VWAP).
The combination of Momentive and Zendesk provides Momentive stockholders, who will own approximately 22% of the combined company, with significantly higher value potential than Momentive as an independent company. As supported by discounted cash flow (“DCF”) analyses undertaken by Momentive’s independent financial advisors, including the value of synergies, the implied value of the consideration is estimated to be in the mid-$30s per share. This value represents a material premium to Momentive’s standalone DCF valuation.
With Zendesk, Momentive stockholders will have the opportunity to participate in the upside potential and synergies of a larger, faster growing company. Zendesk and Momentive expect to drive value creation across three primary categories of revenue synergies: (1) selling Momentive products through the global Zendesk sales channel, which is six times larger than Momentive’s existing North American-centric sales force; (2) expanding the suite of capabilities available to customers by integrating products across our joint platforms; and (3) selling Zendesk products into Momentive’s customer base. Importantly, Zendesk has a proven track record of delivering sustainable growth, driving strong adoption in Enterprise businesses and diversifying its go-to-market model. This experience, in addition to Zendesk’s sizeable installed base and team, will accelerate Momentive’s sales-assisted Enterprise transformation and extend our capabilities further into untapped global markets, accelerating Momentive’s overall growth.
Through these opportunities, the combined company expects to realize revenue synergies of approximately $55 million in 2023, $150 million in 2024 and $275 million in 2025.1 With expected revenue scale of $4.6 billion by 2025, the combined company will be one of the largest public SaaS companies by total revenue with an exceptional growth profile among other scaled operators. The transaction also accelerates both companies’ growth rates at greater scale and is expected to generate a 27% combined compounded annual growth rate (CAGR) from 2021 to 2025.2
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