M&A Discussion in the Domain Space

4

Frank Schilling authored an article in Entrepreneur about mergers and acquisitions. Frank shared his thoughts on the considerations a business owner must make before deciding on a M&A opportunity. Interestingly, Frank shared the following about M&A experience with his own business:

“Potential buyers approached me five times in four years in pursuit of my business, Uniregistry, as I told DN Journal in 2007. Several offered nine-figure deals, and they were willing to go higher at each point in our negotiations. I met with each one and seriously considered their propositions. In the end, selling didn’t feel right. I may sell eventually, but not until I find a situation that suits my goals and represents what I believe is best for the company.”

The article was timely, as it seems there is some M&A discussion in the domain name business, according to two reports published yesterday.

In a report published on Reuters, publicly traded Web.com is reportedly in buyout discussions. According to the article, “Web.com Group Inc, a U.S. provider of internet domain name registration that also helps businesses build websites, is in talks with private equity firms after receiving takeover approaches, people familiar with the matter said on Thursday.”

In a news  release published  on its website  yesterday, MMX (formerly Minds + Machines) announced that it hired a US investment banking firm “to review the various strategic options open to the Company to maximise value for shareholders.” I reached out to MMX CEO Toby Hall, and he told me that the investment bank is going “conduct a strategic review to see how MMX can best participate in the broader industry consolidation.”  The news release also noted that “[T]he outcome of the strategic review may therefore include, but not be limited to, an acquisition by or sale / merger of the Company.”

It is no surprise that there is quite a bit of M&A talk in the domain space. For such a small sector, there are a lot of companies operating. In addition, I would presume that many of the companies could make more money if they were operating at a greater scale by merging with another industry company or participating in an acquisition.

I would bet there is going to be industry consolidation, perhaps as soon as this Summer. I have no idea what companies will be involved, but it seems like there is quite a bit of discussion happening.

4 COMMENTS

  1. There will certainly be industry consolidation but given the current state of nTLD’s I assume it won’t be takeovers but mostly takeunders. Uniregistry is an exemption. I hope Frank will never sell.

  2. The new gtld business is here to stay, and domain investing is evolving along with the world’s new economies. We’ll see a subset of new gtld’s gain in popularity & use over the next few years while registries & registrars continue their consolidation. Economic opportunity is opening up after 8 stale years under Obama’s watch.

Leave a Reply