A Zoom virtual meeting program from Google is one of the most important programs for virtual lessons, video conferences and online meetings used worldwide during the COVID-19 pandemic. Photo: AFP

Zoom Video Communications struck a $14.7 billion all-stock deal to buy cloud-based call center operator Five9 Inc in its largest-ever acquisition, as it looks to expand beyond its core video-conferencing services.

Zoom has become a household name and investor favorite amid the coronavirus pandemic, as businesses and schools adopted its services to hold virtual classes, office meetings and social occasions.

But with rapid vaccination and life creeping back to normality, analysts and investors are looking to see how Zoom will sustain its hot streak of growth, especially with rivals Microsoft Corp, Cisco Systems and Alphabet's Google snapping at its heels.

Five9, whose call center software is used by more than 2,000 clients across the globe to interact with clients, counts firms such as Under Armour, Lululemon Athletica and Olympus Corp as customers.

The deal makes strategic sense, as it helps accelerate Zoom's product roadmap outside of its core offering, Barclays analyst Raimo Lenschow wrote in a note.

The California-based company is shifting focus to its two-year-old cloud-calling product Zoom Phone and conference-hosting product Zoom Rooms as bigger players ramp up their video products.

"The acquisition is expected to help enhance Zoom's presence with enterprise customers and allow it to accelerate its long-term growth opportunity by adding the $24 billion contact center market," Zoom said in a statement on July 18.

Under the terms of the deal, approved by the boards of both companies, Five9 stockholders will receive 0.5533 shares of Zoom stock for each share of Five9.

Five9 will become an operating unit of Zoom and its chief executive, Rowan Trollope, will become a president of the company, staying on as chief of the unit after the deal, which is expected to close in the first half of 2022, it said.

Global spending on cloud-based conferencing is forecast to reach $5.41 billion this year, according to Gartner.