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December 7, 2016

GoDaddy buys European hosting rival for €1.69 billion

GoDaddy pushes into Europe with acquisition of HEG, capitalising on its European footprint.

By Alexander Sword

GoDaddy will acquire fellow hosting provider Host Europe Group (HEG) for €1.69 billion as it seeks to build a European presence.

The acquisition, including €605 million paid to the selling shareholders and €1.08 billion in assumed net debt, will allow GoDaddy to integrate the majority of HEG’s business into its own operations.

The combination of the two companies will allow more rapid deployment of products to customers and allow better scaling of product development and investments across the companies.

According to a statement from HEG, the two companies share a cultural focus on small business users. The core customer base of both companies is small ventures and the web professionals who support them.

godaddy-2HEG holds the World Hosting Day and NamesCon brands and conferences, and offices in Germany, the U.K., France, Spain, Romania, and Bulgaria.

Other options for HEG’s PlusServer managed hosting business will be explored including a sale, due to its differing business model from GoDaddy.

The transaction is expected to close in the second quarter of 2017. Patrick Pulvermüller, the Group CEO of HEG, will lead the combined company’s European operations.

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“GoDaddy has successfully expanded its international business to 56 global markets over the past four years,” said GoDaddy CEO Blake Irving.

“HEG has built an impressive business that generates strong top-line growth, high margins, and industry-leading customer satisfaction. By joining forces with HEG, we accelerate our expansion into Europe with the delivery of a broader range of cloud-based products, built on a single global technology platform, and supported by unparalleled customer care to help small businesses and web designers succeed online.”

“In combining with GoDaddy, we see a remarkable opportunity for our customers, partners and the small business ecosystem in Europe,” said Patrick Pulvermüller, Group CEO of HEG.

Pulvermüller emphasised the “strategic alignment” of the two companies.

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