Go Daddy's marketing prominently features "Go Daddy Girls," including racecar driver Danica Patrick
(WEB HOST INDUSTRY REVIEW) -- Coming shortly after rumors the company was about to be sold, web hosting provider Go Daddy (http://www.godaddy.com/) announced late on Friday, in a statement posted to its website, that it had “signed a definitive agreement to receive a strategic investment and enter into a partnership with KKR, Silver Lake and Technology Crossover Ventures.”
Details of the investment were not disclosed, however rumors published last week by Bloomberg, the Wall Street Journal and others, which called the deal an acquisition, and identified KKR and Silver Lake as buyers, put the price tag for the company between $2 billion and $2.5 billion.
A Friday report by Reuters also referred to Go Daddy being “bought,” for $2.25 billion, including debt.
"I've always said we would make a move like this when the right deal with the right partners could help us do the right thing for our customers and our employees," said Go Daddy CEO and Founder Bob Parsons, quoted in the announcement. "This is it! 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."
Founded in 1996 by the outspoken Parsons, Go Daddy rose to the top of the domain registration and shared hosting markets over the last decade through price competition and some shrewd marketing, that included several controversial Super Bowl ads that drove a tremendous amount of attention to the company.
In 2006, Go Daddy filed the initial papers for an IPO, but later withdrew its filing due to poor market conditions.
Go Daddy was rumored to be for sale in September of 2010, following a news story appearing in the Wall Street Journal. The details were more vague at the time, but the valuation was in the range of $1 billion.
If the rumors are true, including the suggestion that Go Daddy passed on the September 2010 deal to wait for a better valuation, the plan appears to have paid off.
The speculation that followed the sale rumor during the past week has included optimism around the fact that Go Daddy serves the small business market, which is booming in the US, along with concerns that the company trades in such low-margin commodities as shared hosting, domain names and SSL certificates.
In late June, it was reported that Go Daddy was planning the launch of a cloud computing service, called Data Center on Demand, sometime in July. The building of a cloud computing offering (a hot commodity in the investment community) may have been a step on the road to Go Daddy completing Friday’s investment, or in securing a more desirable valuation.
"In Go Daddy, we are pleased to be partnering with a high-growth market leader and an outstanding team," said Herald Chen, head of KKR's software and Internet effort, also quoted in the announcement. "Building on Go Daddy's exceptional customer service and loyal customer base, we believe there is significant opportunity to expand the current portfolio of products and services as well as accelerate growth internationally."
Article Source http://www.thewhir.com/web-hosting-news/070111_Web_Host_Go_Daddy_Gets_Investment_from_KKR_Silver_Lake permits to republish here.
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