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GoDaddy Expands in Europe with Host Europe Group Buyout
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Domain registration and web hosting leader, GoDaddy Inc. (GDDY - Free Report) announced yesterday that it has completed the acquisition of Host Europe Group (HEG). The company claimed that the acquisition has made it a market leader for small business cloud services in Europe.
The deal is valued at €1.69 billion (US$1.79 billion), out of which €605 million will be paid to selling shareholders and €1.08 billion in assumed net debt.
Host Europe Group is one of the largest independent web hosting firms in the continent. It operates brands such as 123Reg, Domain Factory, Heart Internet and Host Europe. Host Europe Group was purchased by private equity owner Cinven in 2013 for £438 million and since then has done well to evolve as a leader in its field.
We note that shares of GoDaddy outperformed the Zacks Internet Services Delivery industry over the past one year. While the industry gained 15.7%, the stock returned 23.1%. Going forward, investments in products, its technology platform and customer care as well as delivery of innovative and increasingly personalized products and services globally are expected to back the momentum.
Strengthening Foothold in Europe
The acquisition makes sense as HEG will strengthen GoDaddy’s foothold in the European market.
In Europe, HEG has more than 1.7 million customers, primarily in Germany and the U.K. The deal will accelerate GoDaddy’s expansion throughout the region, in sync with the company’s strategy to expand internationally.
Boosting Web Hosting
GoDaddy has been targeting a shift toward creating dynamic online presence for small businesses. The company has branched into the more profitable business of hosting websites for small businesses and consumers. The buyout of HEG should expedite this shift.
The acquisition will significantly boost GoDaddy’s Hosting and Presence revenues. In the last reported quarter, this business generated $176.7 million and accounted for 36.4% of total revenue. It grew 8.6% sequentially and 28.8% year over year.
Notably, the projected long-term growth rates for TDK, Micron and Square are 10.75%, 10% and 22.5%, respectively.
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GoDaddy Expands in Europe with Host Europe Group Buyout
Domain registration and web hosting leader, GoDaddy Inc. (GDDY - Free Report) announced yesterday that it has completed the acquisition of Host Europe Group (HEG). The company claimed that the acquisition has made it a market leader for small business cloud services in Europe.
The deal is valued at €1.69 billion (US$1.79 billion), out of which €605 million will be paid to selling shareholders and €1.08 billion in assumed net debt.
Host Europe Group is one of the largest independent web hosting firms in the continent. It operates brands such as 123Reg, Domain Factory, Heart Internet and Host Europe. Host Europe Group was purchased by private equity owner Cinven in 2013 for £438 million and since then has done well to evolve as a leader in its field.
We note that shares of GoDaddy outperformed the Zacks Internet Services Delivery industry over the past one year. While the industry gained 15.7%, the stock returned 23.1%. Going forward, investments in products, its technology platform and customer care as well as delivery of innovative and increasingly personalized products and services globally are expected to back the momentum.
Strengthening Foothold in Europe
The acquisition makes sense as HEG will strengthen GoDaddy’s foothold in the European market.
In Europe, HEG has more than 1.7 million customers, primarily in Germany and the U.K. The deal will accelerate GoDaddy’s expansion throughout the region, in sync with the company’s strategy to expand internationally.
Boosting Web Hosting
GoDaddy has been targeting a shift toward creating dynamic online presence for small businesses. The company has branched into the more profitable business of hosting websites for small businesses and consumers. The buyout of HEG should expedite this shift.
GoDaddy Inc. Revenue (TTM)
GoDaddy Inc. Revenue (TTM) | GoDaddy Inc. Quote
The acquisition will significantly boost GoDaddy’s Hosting and Presence revenues. In the last reported quarter, this business generated $176.7 million and accounted for 36.4% of total revenue. It grew 8.6% sequentially and 28.8% year over year.
Zacks Rank and Better Picks
Currently, GoDaddy has a Zacks Rank #3 (Hold).
Better-ranked stocks in the broader technology space include TDK Corp (TTDKY - Free Report) , Micron Technology, Inc. (MU - Free Report) and Square, Inc. (SQ - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Notably, the projected long-term growth rates for TDK, Micron and Square are 10.75%, 10% and 22.5%, respectively.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>