Light Street Capital Urges Zendesk Board to Delay Vote and Constructively Engage in Good Faith with its Shareholders
Light Street Capital, managing over 2% of Zendesk's shares, expressed disappointment in the board's lack of engagement regarding its alternative proposal. The firm intends to vote against Zendesk's proposed merger with Hellman & Friedman and Permira Advisers, asserting that a superior path exists through its proposal. Light Street reported strong support from major shareholders and affirmed availability of financing contingent on collaborative engagement with the board. The firm urges the board to postpone the upcoming shareholder vote to evaluate both proposals for the benefit of all shareholders.
- Strong support for the alternative proposal from major Zendesk shareholders.
- Availability of committed financing contingent on engagement with the board.
- The board's lack of engagement could lead to shareholder dissatisfaction.
- The firm intends to vote against the proposed transaction, indicating potential division among shareholders.
Expresses Disappointment in Zendesk's Lack of Engagement
Reiterates Confidence in Alternative Proposal and Intention to Vote AGAINST the Proposed Transaction
Affirms Intention to Secure Capital Needed to Execute on Superior Alternative Proposal with Constructive Engagement from Zendesk Board and Management
Highlights Strong Support for Alternative Proposal from Major Zendesk Shareholders
Full Text of the Letter, along with Details of Light Street's Alternative Proposal, Available at www.lightstreet.com/zen
PALO ALTO, Calif., Sept. 12, 2022 /PRNewswire/ -- Light Street Capital Management, LLC ("Light Street" or the "Firm"), which manages funds that own more than two percent of the outstanding shares of Zendesk, Inc. (NYSE: ZEN) ("Zendesk" or the "Company"), today delivered a letter to the Zendesk Board of Directors (the "Board") expressing extreme disappointment in the Board's failure to engage with Light Street or its shareholders regarding the alternative and superior path forward for the Company and its shareholders that was delivered to the Board on August 29 (the "Alternative Proposal").
In the letter, Light Street affirms its intention to vote AGAINST the Company's proposed transaction with affiliates of funds advised by Hellman & Friedman LLC and Permira Advisers LLC (the "Proposed Transaction"), and highlights strong indications of support from many of Zendesk's largest shareholders who believe the Alternative Proposal, under the right terms and with qualified partners, represents a superior path forward for Zendesk. Further, after discussions with a number of large, multi-billion-dollar asset managers that are premier enterprise software investors in both the public and private equity markets, Light Street affirms its confidence that committed financing would be available with constructive and collaborative engagement of the Zendesk Board and management.
In light of the superior nature of the Alternative Proposal and access to committed financing necessary to execute it, Light Street urges the Board to postpone the upcoming shareholder vote and constructively engage with Light Street and other investors in good faith to seriously consider both paths forward for the benefit of all Zendesk shareholders.
The full text of the letter delivered to the Zendesk Board, along with detail regarding Light Street's alternative proposal to Zendesk can be found at www.lightstreet.com/zen.
About Light Street Capital Management
Founded in 2010, Light Street Capital Management, LLC is an investment management firm based in Palo Alto, California. The firm invests globally in technology businesses across public and private markets.
Important Information
Light Street, together with the other participants named herein, intends to file a proxy statement with the Securities and Exchange Commission (the "SEC") to be used to urge stockholders of Zendesk, Inc. (the "Company") to vote on the Company's proxy card "AGAINST" the proposed merger of the Company with affiliates of funds advised by Hellman & Friedman LLC and Permira Advisers LLC, and other Company proposals, at the upcoming special meeting of stockholders of the Company.
LIGHT STREET STRONGLY ADVISES ALL STOCKHOLDERS OF THE COMPANY TO READ LIGHT STREET'S PROXY STATEMENT AND OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. SUCH PROXY MATERIALS AND ANY OTHER RELEVANT DOCUMENTS WILL BE AVAILABLE AT NO CHARGE ON THE SEC'S WEBSITE AT WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS IN THIS PROXY SOLICITATION WILL PROVIDE COPIES OF THE PROXY STATEMENT WITHOUT CHARGE UPON REQUEST. REQUESTS FOR COPIES SHOULD BE DIRECTED TO THE PARTICIPANTS' PROXY SOLICITOR.
STOCKHOLDERS OF THE COMPANY ARE ALSO ADVISED TO READ THE DEFINITIVE PROXY STATEMENT, DATED AUGUST 8, 2022, AND OTHER DOCUMENTS RELATED TO THE SOLICITATION OF PROXIES BY THE COMPANY FROM ITS STOCKHOLDERS FOR USE AT THE COMPANY'S UPCOMING SPECIAL MEETING OF STOCKHOLDERS, BECAUSE THEY CONTAIN IMPORTANT INFORMATION. A DEFINITIVE PROXY STATEMENT HAS BEEN MAILED TO STOCKHOLDERS OF THE COMPANY AND IS ALSO AVAILABLE AT NO CHARGE ON THE SEC'S WEBSITE AT WWW.SEC.GOV.
Participant Information
The participants in the proxy solicitation are anticipated to be Light Street, Light Street Mercury Master Fund, L.P., Light Street SPV7, L.P., Light Street Tungsten Master Fund, L.P., Light Street Halo, L.P. and Glen Kacher.
As of the date hereof, Light Street Mercury Master Fund, L.P. ("Mercury") directly owns 1,257,571 shares of common stock, par value
Forward-looking Statements
Certain statements contained in this letter, and the documents referred to in this letter, are forward-looking statements including, but not limited to, statements that are predications of or indicate future events, trends, plans or objectives including the Light Street proposal set forth herein. Undue reliance should not be placed on such statements because, by their nature, they are subject to known and unknown risks and uncertainties. Forward-looking statements are not guarantees of future performance or activities and are subject to many risks and uncertainties. Due to such risks and uncertainties, actual events or results or actual performance may differ materially from those reflected or contemplated in such forward-looking statements, including the facts that the Light Street proposal set forth herein is non-binding and subject to due diligence and the execution of mutually acceptable definitive documents, may be rejected by the Company, and/or may be subject to certain closing conditions including stockholder approval and therefore such proposal may not be consummated. Forward-looking statements can be identified by the use of the future tense or other forward-looking words such as "believe," "expect," "anticipate," "intend," "plan," "estimate," "should," "may," "will," "objective," "projection," "forecast," "management believes," "continue," "strategy," "position" or the negative of those terms or other variations of them or by comparable terminology.
Important factors that could cause actual results to differ materially from the expectations set forth in this letter include, among other things, the factors identified under the section entitled "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2021, as amended, and under the section entitled "Forward-Looking Statements" in the Company's Definitive Proxy Statement, filed with the SEC on August 8, 2022. Such forward-looking statements should therefore be construed in light of such factors, and Light Street is under no obligation, and expressly disclaim any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Information Regarding Any Proposed Transaction
In furtherance of the Light Street proposal and subject to future developments, Light Street (and, if a negotiated transaction is agreed, the Company) may file one or more registration statements, proxy statements, tender offer statements or other documents with the SEC. This letter is not a substitute for any proxy statement, registration statement, tender offer statement, prospectus or other document Light Street and/or the Company may file with the SEC in connection with any proposed transaction.
INVESTORS AND SECURITY HOLDERS OF THE COMPANY ARE URGED TO READ ANY SUCH PROXY STATEMENT(S), REGISTRATION STATEMENT, TENDER OFFER STATEMENT, PROSPECTUS AND/OR OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE AS THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT A PROPOSED TRANSACTION. Any definitive proxy statement(s) or prospectus(es) (if and when available) will be mailed to stockholders of the Company. Investors and security holders will be able to obtain free copies of these documents (if and when available) and other documents filed with the SEC by Light Street and/or the Company through the SEC's web site at www.sec.gov.
This letter is neither a solicitation of a proxy nor a substitute for any proxy statement or other filings that may be made with the SEC. Nonetheless, Light Street and/or its directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of any proposed transaction. Additional information regarding the interests of such potential participants may be included in one or more registration statements, proxy statements, tender offer statements or other documents filed with the SEC if and when they become available. These documents (if and when available) may be obtained at no charge on the SEC's website at www.sec.gov.
Notice to Investors
Notwithstanding anything stated herein, Light Street reserves the right to sell shares of the Company in the future in connection with redemption requests by investors in its affiliated funds or in the event the Company's Board of Directors is not responding, in the opinion of Light Street, appropriately to the Light Street proposal and it is in such funds' interests to do so.
Media Contacts
ASC Advisors
Steve Bruce / Taylor Ingraham
sbruce@ascadvisors.com / tingraham@ascadvisors.com
{203} 992-1230
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SOURCE Light Street Capital Management
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