GoDaddy, one of the world’s largest cloud platforms dedicated to small, independent ventures, has entered into a definitive agreement to acquire Host Europe Group (HEG) for $1.79 billion (€1.69 billion). HEG is currently owned by international private equity firm Cinven which acquired the business in August 2013 for $668 million.
GoDaddy intends to integrate the majority of HEG’s business while exploring strategic alternatives for HEG’s PlusServer managed hosting business, including a possible sale. HEG has offices in Germany, the U.K., France, Spain, Romania, and Bulgaria.
As one of the largest web services providers in Europe, HEG serves small businesses and web experts. The company provides its services to currently more than 1.7 million customers. With strong positions in the UK and Germany, including brands such as 123Reg, Domain Factory, Heart Internet and Host Europe, HEG would complement GoDaddy’s position in the U.S. and its fast-growing international footprint.
Combining GoDaddy’s global technology platform with HEG’s footprint in Europe would enable the rapid deployment of a broader range of products to customers and allow for better scale of product development and go-to-market investments across both companies.
GoDaddy and HEG share a strong cultural focus on the needs of small business customers, supporting their product offerings with consultative customer care that would drive high customer retention.
“GoDaddy has successfully expanded its international business to 56 global markets over the past four years,” said Blake Irving, CEO of GoDaddy. “HEG has built an impressive business that generates strong top-line growth, high margins, and industry-leading customer satisfaction. By joining forces with HEG, we accelerate our expansion into Europe with the delivery of a broader range of cloud-based products, built on a single global technology platform, and supported by unparalleled customer care to help small businesses and web designers succeed online.”
Patrick Pulvermüller will lead the combined company’s European operations. He will report to Andrew Low Ah Kee, GoDaddy’s Executive Vice President of International. GoDaddy’s European team will report into Mr. Pulvermüller.
“In combining with GoDaddy, we see a remarkable opportunity for our customers, partners and the small business ecosystem in Europe,” said Patrick Pulvermüller, Group CEO of HEG. “What stands out is the strategic alignment of the companies – we’re both driven to empower people to transform their ideas and bring them to life online. Together GoDaddy and HEG will provide even more value for our customers and introduce new solutions to help their ventures succeed.”
PlusServer, World Hosting Day
The PlusServer business model differs from the GoDaddy brand as it serves larger, more mature companies that require a dedicated field sales force and account management. GoDaddy intends to explore strategic alternatives for the PlusServer business, which is expected to generate approximately $92 million in bookings and $41 million in adjusted EBITDA in 2016.
HEG also owns the World Hosting Day and NamesCon brands and conferences, mainstays in the global website hosting and domain communities. GoDaddy will continue to operate these brands independently and invest in their continued growth.