A group of investment firms including Kohlberg Kravis Roberts (KKR), Silver Lake and Technology Crossover Ventures have reportedly acquired the Go Daddy Group. The domain name registrar is possibly the largest in the world with close to 9.4 million customers paying subscription fees, and almost 48 million domain names being managed.
According to the New York Times, the financial terms weren’t disclosed but sources say the buyers are shelling out $2.25 billion. Go Daddy, spurred by interest from buyout firms as well as corporate suitors, originally approached the Qatalyst Partners investment bank to explore a possible sale.
Go Daddy was pondering an IPO in 2006 hoping to reach $200 million, but the company only reported $139.8 million and had to back down from those plans. Since then the company has been steadily building by 20 percent annually and reported $1.1 billion in sales in its last fiscal year.
Executives from the group of investment firms said that Go Daddy’s approach was not likely to be changed. The web-hosting giant’s CEO and founder Robert Parson, whom you may remember slaying elephants valiantly in Zimbabwe, told the New York Times that this was more of a partnership rather than a sale. He will be a large stakeholder once everything is finalized and will be the executive chairman of the company.
Private equity firms find the company’s business of garnering steady subscription fees quite attractive. Go Daddy is also poised to take advantage of expanded internet use requiring more websites and domains. Robert Parsons has expressed that the company also plans to expand its offerings. This mainly means augmenting well-known services, building Go Daddy’s international presence and moving into cloud-based services.
In a press release regarding the sale, Parson said, “We are partnering with KKR, Silver Lake and TCV because of their technology expertise, their understanding of Web based businesses and because their values align with ours. We believe, together, we will take the company to the next level, especially when it comes to accelerating international growth.”