CentralNic Group plc (LON:CNIC), a leading global player and consolidator in the highly cash generative, recurring revenue domain and web services industry, has acquired the business assets of Delaware-based GlobeHosting Inc., a leading registrar and domain hosting provider in multiple markets including Romania and Brazil. The total consideration of €2.56 million comprises an initial consideration of €1.5 million, coupled with a deferred payment of €608k due on the first anniversary of completion and €450k due on the second anniversary of completion.
This transaction is CentralNic’s third acquisition in nine months, as it continues its industry consolidation strategy, expanding into key markets that offer significant growth opportunities.
GlobeHosting is a recurring revenue business operating as a registrar and retailer of domain names and SSL certificates, and a hosting provider servicing principally the Romanian and Brazilian markets. Its businesses fit comfortably into CentralNic’s Retail and Reseller divisions, two of the four key industry channels alongside Corporate and Registry, all of which are well-served by CentralNic following its August acquisition of KeyDrive S.A. for a maximum consideration $55 million.
The total consideration of €2.56 million represents 3.0x of GlobeHosting’s revenues of €849k for the 12 months to 31 July 2018 and 6.1x of its EBITDA of €419k. All figures given in this announcement are based on unaudited management accounts for the period to July 2018. The acquisition is being funded from the Company’s own cash resources.
Romania’s country code, .RO, is undergoing significant adjustment from which GlobeHosting is expected to benefit, with imminent changes to its pricing structure involving all existing .RO users renewing their domains. Internet penetration in Romania is growing with an approximately four per cent increase in 2017. Currently approximately 60 per cent of Romania’s circa 20 million population uses the Internet.
Ben Crawford, CEO of CentralNic Group Plc, said: “GlobeHosting plugs very easily into CentralNic’s business operations and enhances the quality of the Group’s earnings. The transaction adds to CentralNic’s access to the Romanian and Brazilian markets, which each exhibit attractive characteristics for sustained growth, as well as taking advantage of the upselling capabilities and economies of scale that CentralNic brings to the companies it acquires.”
