It's a modified Merger Monday. M&A activity took center stage as the trading week got set to begin. However, not every headline related to deal announcements.
In fact, the biggest news of the morning involved a transaction that won't take place. Bill Ackman’s Pershing Square Tontine (NYSE:PSTH) announced that it was pulling out of its deal to purchase a stake in Universal Music.
Another high-profile deal had better news on Monday. Salesforce (NYSE:CRM) said its planned acquisition of Slack Technologies (NYSE:WORK) has received approval from the U.S. Department of Justice.
A newly announced deal also received some attention before the opening bell. Zoom Video Communications (NASDAQ:ZM) has reached an agreement to acquire cloud contact center provider Five9 (NASDAQ:FIVN).
Deal making (and deal-breaking) may have driven moves in individual stocks on Monday. But the general market largely responded to increased worries about the Delta variant of COVID. Airlines and cruise companies were particularly hurt before the bell. This included declines in American Airlines (NASDAQ:AAL), United Airlines (NASDAQ:UAL) and Southwest Airlines (NYSE:LUV).
Pershing Square Tontine canceled a deal to purchase a 10% stake in Universal Music because the SEC and the NYSE judged that it violated the NYSE's rules regarding SPACs. The Universal deal will be taken over by Ackman's main hedge fund and PSTH will look for a more conventional SPAC merger.
Meanwhile, Zoom has agreed to buy Five9 in a stock deal valued at about $14.7B. The exchange rate for the transaction values each FIVN at 0.5533 of a share of ZM, equating to a purchase price of about $200.28 per share.
FIVN climbed about 7% in pre-market action on the deal, rising to $191.17. ZM dipped about 1.3% on the news.