American website domain provider GoDaddy Inc. now aims to create a strong foothold in Europe. In what appears to be a rather beneficial decision, the company has decided to approach the peer Host Europe Group, also referred to as HEG for an acquisition offer. Although the deal has not been sealed yet, the absorption is deemed to take place at the rate of 1.69 billion euros.
The GoDaddy and HEG deal will no doubt produce the most desired results. With the American web requirements for small brands being catered to, GoDaddy feels that it is time to cross the Atlantic and move into Europe, which is another very lucrative zone for the domain provider. GoDaddy Chief Executive Blake Irving correctly puts this move as a ‘five year jump in Europe’.
Signs of progress have already started showing. The very mention of the deal in the news has caused the price of the shares of GoDaddy to go up by 2.2 per cent and it is evident that these shareholders will be quite benefited as the days go by. Discussions with HEG had started last month, but more discussions are to be done with European private equity firm Cinven Ltd, that happens to be the current owner of the company. Cinven had taken over around the month of August in the year 2013. Since then, the company has been doing fairly good.
Previous plans to acquire the firm had been shelved, primarily because the two parties felt that there would be concerns over integration at that time. Now, GoDaddy Inc is going to come up with a two sided approach, where apart from simply buying the HEG services, the American company will also use HEG PlusServer for managing its hosting business. This could be a major motive to enable a successful move.
The merger between GoDaddy Inc and Host Europe Group will no doubt help to boost profits for both parties and with the HEG chief executive, Patrick Pulvermuller at the head of operations in this new company, the two will face no lack of expertise when it will come down to handling the European consumer base.