October 28 (Reuters) – Software services company Zendesk Inc (ZEN.N) announced Thursday that it will acquire Momentive Global Inc (MNTV.O), owner of the popular SurveyMonkey platform for nearly $ 4 billion in as part of an all-equity transaction.

Momentive shareholders will receive 0.225 Zendesk share for each Momentive share they own, which implied a value of approximately $ 28 per share at the time of the announcement.

Zendesk shares fell 16% in aftermarket trading, while Momentive also fell almost 9% to $ 22.70 per share.

Momentive, then named Survey Monkey, went public in September 2018 at $ 12 per share. The San Mateo, Calif., Based company renamed Momentive in an effort to expand its portfolio of experience management services earlier this year.

Zendesk, a customer service software company, has faced headwinds during the pandemic as its corporate customers accelerate digital transformation.

This will be the company’s biggest acquisition.

“We have a great overlap of clients. It’s incredibly powerful. And we think it will create a whole new richer image of your clients,” Mikkel Svane, CEO of Zendesk, told investors Thursday.

The deal is expected to be finalized in the first half of 2022, pending approvals from Zendesk and Momentive shareholders.

A sharp drop in stock prices has already led to the collapse of all-stock deals such as Zoom Video Communications Inc’s (ZM.O) $ 14.7 billion purchase of software company Five9 Inc ( FIVN.O).

Zendesk also announced its quarterly revenue on Thursday, which rose 32% to $ 347 million.

He expects the deal with Momentive to accelerate its revenue plan to $ 3.5 billion in 2024, a year ahead of its previous target.

Reporting by Krystal Hu in New York and Noor Zainab Hussain in Bengaluru; Editing by Arun Koyyur and Chris Reese

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