Godaddy sells for 2.25B to a private equity group

[Sgt_Kickaxe]

Godaddy has been known as a cheap place to register domain names and get unlimited hosting plans with unlimited domains per plan.

Go Daddy Group Inc. has been sold to a group of private equity firms in a deal valued at $2.25 billion.

The purchase, which includes assumption of the company's debt, was announced Friday afternoon by Go Daddy and the group of firms, made up of KKR & Co., Silver Lake Partners and Technology Crossover Ventures.

"What these guys see is a company with a lot more potential internationally and more potential to make partnerships and acquisitions," Bob Parsons, the company's chief executive and founder, said. "They'll help us finance and they'll help us recruit talent. [latimesblogs.latimes.com...]

"

Now that it's sold the new owners will want to earn money, do you see a price increase or service reduction in the near future? Perhaps a service improvement?

[edited by: Brett_Tabke at 3:11 pm (utc) on Jul 2, 2011]
[edit reason] added quotes [/edit]

[weeks]

The NYT answers your questions this morning:

Robert Parsons, Go Daddy’s outspoken founder and chief executive, said the company planned to expand its offerings, including moving into cloud-based services and aggressively building its international presence.

“This isn’t a sale,” he said in a telephone interview. “It’s a partnership that’s reinvesting in Go Daddy.”

The buyout firms have received financing commitments from their financial advisers, Barclays Capital, Deutsche Bank and RBC Capital Markets, as well as K.K.R.’s own capital markets arm.

Only about half of the purchase price is in debt financing. Herald Chen, an executive at K.K.R., said the buyout firms viewed the company as a growth investment that did not require adding much debt....

Parsons will become executive chairman of the company after the sale closes, and he will remain a large stakeholder.

“I couldn’t get all the equity I wanted,” Parsons said.
[dealbook.nytimes.com...] investors in GoDaddy intend to make money by earning it.

[Sgt_Kickaxe]

I'd say that's good news. I think Mr Parsons made out like a bandit if he took the other half of the purchase price for himself. Those are some fairly potent backers as well, time to perform!

[weeks]

I think Mr Parsons made out like a bandit if he took the other half of the purchase price for himself.

You (and 99 percent of everyone else) misunderstand what this deal is about.

GoDaddy needed money to make its next move. Parsons didn't want to do an IPO. The banks do not understand his business. These guys do. His new partners have the money along with the expertise Parsons needs as well.

Parsons is not cashing out, according to the reports, but getting ready to make a move from being rich to being more rich.

[np2003]

Godaddy had a billion dollars in debt?

[johnhh]

Barclays Capital, Deutsche Bank

are banks - it will be resold in a few years making them a few dollars + the fees

[weeks]

The buyout firms have received financing commitments from their financial advisers, Barclays Capital, Deutsche Bank and RBC Capital Markets, as well as K.K.R.’s own capital markets arm.

John, the banks are simply providing financing to the buyers. Unlike you and I, it appears that the buyers didn't have several hundred million just sitting around. Besides, it's tacky to use your own money. Use other people's money.

[tictoc]

Glad to see this. I hope they turn it into a better domain name registrar and get away from the spammy thing it is today when you try and buy something. Too much clutter when you make a purchase and the site always seems slow. I'd move all my domains there if they make some changes and make an offer I can't refuse.

As for Parsons.. no comment.

[creative craig]

I hope they turn it into a better domain name registrar and get away from the spammy thing it is today when you try and buy something. Too much clutter when you make a purchase and the site always seems slow.

I doubt they will get rid of these aspects as this is one of the things differentiates Godaddy from alot of other registrars

[johnhh]

John, the banks are simply providing financing to the buyers

yeah... yeah..., the loans turn sour as the interest on the debt can't be covered, the banks do a swap loans for equity, for a nice fee, then sell the lot on to Blackstone or someone, for another fee.. we have enough examples here in the UK to last a lifetime. Saw one company - 50 mill in cash got billions in debt finance to finance takeover, you try that with your bank manager in the same ratios :)

[adder]

Are we 100% sure that the G is not behind this?

As for their future plans, I hope they get rid of stuff that makes them losses - all the stupid promotions like the regular $1 .INFO sale and cheap .COMs because those almost never result in a renewal. The wast majority of the $1 promotions get dropped after the first year making them losses of millions and millions! They dropped .NAME a while ago and they will drop more extensions. I also expect they're gonna cut staff.

Godaddy had a billion dollars in debt?

That's not a lot for such a big company with such a big potential.

As for Parsons.. no comment.

I know that this won't make me a popular person here, but I must admit I quite like cheeky and adventurous people.

[ember]

I've been moving our domains away from them for the past year - can't stand Parsons, his misogynist site or his elephant killings.