Domain name and web services provider Web.com has acquired Webcentral, the company formerly known as Melbourne IT and Arq Group, for $12.2 million.
The acquisition marks the end of the beleaguered web hosting provider’s months-long strategic review, which started in September 2019.
The review involved the sale of multiple assets, including the sale of the Enterprise business (which retained the Arq Group name as part of the deal) for $35 million to Sydney-based investment firm Quadrant Private Equity, as well as rebranding to Webcentral on 26 June.
Webcentral owns and operates the SMB business of the former Arq Group, with the brands Netregistry, WME, Melbourne IT and Domainz under its umbrella.
Web.com Group chief executive Sharon Rowlands said, “Webcentral has been a market leader in the Australian domain names, hosting and digital marketing solutions industries for more than 20 years. Web.com Group looks forward to welcoming Webcentral to our family of leading brands that focus on helping businesses build an online presence that delivers results.”
“We believe the Webcentral offering is a highly complementary offering and builds upon Web.com Group’s expanding presence in Australia following the successful acquisition of Dreamscape in 2019.”
Webcentral chairman Andrew Reitzer said, “Following the announcement of the strategic review in September 2019, the board has carefully assessed all available options to maximise shareholder value.The [Web.com acquisition] provides shareholders an opportunity to realise an immediate cash value for their investment and represents an attractive premium to the prevailing trading price of Webcentral shares.”
“Webcentral’s customers will benefit from the increase in global scale to deploy unique, simple and innovative online solutions, as well as a broader product suite and service capability.”
“I would like to thank the Webcentral management team and staff for their considerable effort and contribution over the duration of the Strategic Review, particularly during recent times while managing COVID-19 related disruption.”
The $12.2 million purchase price represents $0.10 per share, or a 56 percent premium over its current share price of $0.064 per share. Web.com Group also acquired Webcentral’s existing debt facilities.
The acquisition is subject to a shareholder vote, with Webcentral’s board unanimously recommending shareholders to vote in favour of the deal.