Video communication firm Zoom has abandoned its deal to acquire cloud-based contact centre company Five9 for $14.7bn in a blow to its plans to cement its enterprise offering and become a “platform company”.

Five9 said in a statement that the merger was terminated by “mutual agreement”. However, Five9 went on to say that it did not receive enough votes from shareholders to approve the deal.

Zoom CEO Eric Yuan appeared to downplay the setback, writing in a blog post that the Five9 acquisition was “in no way foundational to the success of our platform”.

The deal would have been Zoom’s biggest acquisition to date and was seen by analysts as a move to expand its services to build upon the pandemic boom.

Yuan added that the deal wasn’t the “only way for us to offer our customers a compelling contact centre solution” – suggesting that Zoom has not given up on its plans to move into a market it valued at $24bn.

Zoom announced the all-stock deal in July. That may have been one of the factors in Five9 shareholders voting down the deal. Often in mergers and acquisitions, shareholders receive a premium over their stock price. But an all-stock deal – as opposed to an all-cash deal – means Five9 shareholders were receiving Zoom shares as payment.

Zoom’s stock has lost more than a quarter of its value since the deal was announced, effectively giving Zoom a discounted price.

Five9 shareholders were also advised to vote against the deal by Institutional Shareholder Services, an independent advisor, earlier this month.

Ever since Zoom’s meteoric rise thanks to the pandemic-induced shift to remote working, there have question marks over its ability to sustain its growth in the long term.

The company shook off complaints about “zoombombing” – a person maliciously interrupting an unsecured video call – and criticism of other security aspects to enjoy 369% revenue growth in the final quarter of 2020.

That growth rate has slowed to 54% in its recent quarter, ended 31 July, now that quarters are being compared to growth during the pandemic. However, it is still securing new customers – surpassing $1bn in revenue for the first time – suggesting Zoom has a solid foothold in the post-pandemic world of work.

That being said, its share price has been on a downward trajectory since October 2020. The Five9 deal was seen as a push to expand

David Bicknell, principal thematic analyst at GlobalData, previously told Verdict the acquisition is a “step forward” in Zoom’s goal of becoming a “platform company”.

He added: “At some point, the pandemic will come to an end. Zoom needs to be expanding its communication services and providing increasingly sophisticated tools to target enterprise customers. It needs to diversify its audience to make the most of those new customers it gained last year at the height of the pandemic for its videoconferencing service.”

A Justice Department-led panel had also been investigating Zoom’s Five9 merger, citing national security risks because of the company’s alleged links to China.

Yuan was born in China but has been a naturalised US citizen since 2007. Zoom itself is headquartered in Silicon Valley but some of its engineers have in the past been based in China. However, the investigation was not mentioned as a reason by either party for the deal’s collapse.

Five9 was set to become an operating unit of Zoom with its chief executive, Rowan Trollope, staying on as president. The deal was planned to close in the first half of 2022.

The pair said they will continue a partnership that was in place prior to the merger announcement.

According to GlobalData’s market intelligence, Zoom has previously acquired three companies in its ten years of operations. Its most recent acquisition, announced at the end of June, was machine translation startup Karlsruhe Information Technology Solutions for an undisclosed sum.