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  1. #1
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    iWeb to be acquired by Internap

    "INAP today announced plans to acquire hosting and cloud provider iWeb in a deal valued at approximately $145 million."

    Link: http://blog.iweb.com/en/2013/10/inte...ide/12723.html

    Wonder what that means for existing iWeb users...

  2. #2
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    Wow, what's up with the buy and sell lately?

    I hope the transition will go smoothly for those existing clients.

    Specially 4 U
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  3. #3
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    On a positive side, it is not EIG...

  4. #4
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    Quote Originally Posted by net View Post
    Wow, what's up with the buy and sell lately?

    I hope the transition will go smoothly for those existing clients.
    Lately there has been this and MediaTemple is now part of GoDaddy. Has there been anything else recently?

  5. #5
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    Quote Originally Posted by AcclaimedHost Alan View Post
    Lately there has been this and MediaTemple is now part of GoDaddy. Has there been anything else recently?
    IBM/Softlayer.
    Respectfully,
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    Of course. Thought I was forgetting something

  7. #7
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    I saw this coming -- a buyout of iWeb, but not sure who. Godaddy was on my list of potentials.

    Several companies are positioning themselves against EIG and Godaddy, taking out competition before the "evil" companies can. Most isn't really "competition" as much as a way to solidify their offerings, and have a good products menu. They want a larger company to position themselves.

    I foresee LiquidWeb buying another host at some point. Keep watching. It's fun! FortressITX and Arvixe are two more I watch closely, as acquirers.

    M&A has been my interest since the M&A era of 1998-2001. That was huge back them (BofA, AOL-TW, etc).
    Last edited by kpmedia; 10-30-2013 at 08:27 PM.
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  8. #8
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    Quote Originally Posted by dcdan View Post
    On a positive side, it is not EIG...
    Certainly!
    IMO, EIG hosts are bad.

  9. #9
    What is interesting to me is they post numbers. $145 million deal, $11 million trailing 12 months ebitda (13x ebitda) really a solid valuation there.

    To the point others made about m&a picking up like it did pre-2000, that's true. Quantitative easing has made borrowing money to buy assets of any kind much smarter than sitting on cash that continually loses value, elevating valuations.
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  10. #10
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    I am not happy with this news. I knew iweb was a very good company...why they have to get acquired? It is getting annoying now.
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  11. #11
    Quote Originally Posted by nokia3310 View Post
    I am not happy with this news. I knew iweb was a very good company...why they have to get acquired? It is getting annoying now.
    It sounds like because they're being offered about twice what the company is worth. Speaking with other people in the past who acquire small to medium hosts, they had said typical transactions would be "4-6x ebitda". From previous threads on WHT, the highest multiple that a credible person had reported as "typical" is 7x EBITDA. At 13x EBITDA I would sell my company too. At 4-5x EBITDA you have enough capital to rebuild the company from scratch. At 13x you're getting a substantial premium. Obviously iweb is not what I would call a "small to medium host", they're obviously fairly large, so that likely factors into the higher multiple, but nevertheless, everything is for sale for the right price.
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  12. #12
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    Quote Originally Posted by funkywizard View Post
    It sounds like because they're being offered about twice what the company is worth. Speaking with other people in the past who acquire small to medium hosts, they had said typical transactions would be "4-6x ebitda". From previous threads on WHT, the highest multiple that a credible person had reported as "typical" is 7x EBITDA. At 13x EBITDA I would sell my company too. At 4-5x EBITDA you have enough capital to rebuild the company from scratch. At 13x you're getting a substantial premium. Obviously iweb is not what I would call a "small to medium host", they're obviously fairly large, so that likely factors into the higher multiple, but nevertheless, everything is for sale for the right price.
    Well do you remember Internap acquired the web hosting company voxel.net as well...now try type voxel.net and what happens...swallowed...i have no idea what will happen to iweb....but what i do know is it will get swallowed up into the high price premium market internap is in and leave several customers searching for new homes
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  13. #13
    Quote Originally Posted by nokia3310 View Post
    Well do you remember Internap acquired the web hosting company voxel.net as well...now try type voxel.net and what happens...swallowed...i have no idea what will happen to iweb....but what i do know is it will get swallowed up into the high price premium market internap is in and leave several customers searching for new homes
    No doubt, but you asked "why would they do this". It's pretty clear *why*. Slicehost got bought out by rackspace and they crapped all over it as well. Slicehost had a really solid marketing strategy, I mean, they could have used it as a case study. "hosting for developers". It was spot on, and the result is people paying them 3-5 times what their service would ordinarily cost anywhere else, with people signing up in droves. Rackspace bought it out and I don't know who did it, but whoever ran the website crapped all over that spot-on branding and ruined the message. Whoever was put in charge of running it didn't understand where the value was coming from in the slicehost brand, and in addition to ruining their website and branding, they eventually just redirected it all to rackspace.com and gave up on the brand entirely. That's unfortunately how things go with acquisitions most times.
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  14. #14
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    Just thinking about this...they could have acquired netelligent.ca for much less...or maybe iweb was more attractive because of the better pool and size of current customers?

    also maybe because iweb owns its datacenter?
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  15. #15
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    Quote Originally Posted by kpmedia View Post
    I foresee LiquidWeb buying another host at some point. Keep watching. It's fun! FortressITX and Arvixe are two more I watch closely, as acquirers.
    Liquidweb has a better chance of being acquired than them acquiring another company
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  16. #16
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    Quote Originally Posted by nokia3310 View Post
    Liquidweb has a better chance of being acquired than them acquiring another company
    Lol! Liquid Web are actually a decent sized company..

  17. #17
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    Quote Originally Posted by Conn8ct-Sal View Post
    Lol! Liquid Web are actually a decent sized company..
    Yes i know that..so were softlayer and iweb
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  18. #18
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    Quote Originally Posted by Conn8ct-Sal View Post
    Lol! Liquid Web are actually a decent sized company..
    Quote Originally Posted by nokia3310 View Post
    Yes i know that..so were softlayer and iweb
    http://www.inc.com/profile/liquid-web

    Revenue is only $50 million for 2012 , which is 1/6th of iWeb.
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  19. #19
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    Quote Originally Posted by ishan View Post
    Revenue is only $50 million for 2012 , which is 1/6th of iWeb.
    What you have to remember is its about more than numbers. You MUST look at company philosophy. LW, FortressITX, and several others are strong brands. Companies do grow, and I see them growing rather than being bought out. The fun part is ... which companies?!

    Something small and established like KickassVPS is a perfect acquisition for the likes of them.

    This is all speculation, but it's not random clueless speculation.

    iWeb was floundering, and had its own history of M&A. Sometimes that's a sign of getting larger solely for the purpose of acquisition. Several "unlimited" hosts act like this too, especially in the wake of Brent getting $225M.
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  20. #20
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    Quote Originally Posted by ishan View Post
    http://www.inc.com/profile/liquid-web

    Revenue is only $50 million for 2012 , which is 1/6th of iWeb.
    Just to clarify. I believe you might be confusing "revenue" with "Acquisition price".

    iWebs press release said:
    "In its fiscal year ending September 30, 2013, iWeb delivered approximately $44 million of revenue and $11 million of EBITDA. "
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  21. #21
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    Quote Originally Posted by LiquidWebTravis View Post
    Just to clarify. I believe you might be confusing "revenue" with "Acquisition price".

    iWebs press release said:
    "In its fiscal year ending September 30, 2013, iWeb delivered approximately $44 million of revenue and $11 million of EBITDA. "
    Whoops. My mistake.

    http://blog.iweb.com/en/2013/10/inte...ide/12723.html

    today announced plans to acquire hosting and cloud provider iWeb in a deal valued at approximately $145 million. The combination creates a top five pure-play IT infrastructure services provider, with trailing twelve months revenue in excess of $320 million.

    I overlooked the combination part.
    Last edited by ishan; 10-31-2013 at 06:55 AM.
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  22. #22

    iWeb to be acquired by Internap

    The Internap iWeb $145 million acquisition ='s in a 3.25x revenue - 13x EBITDA transaction

  23. #23
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    Quote Originally Posted by nokia3310 View Post
    Just thinking about this...they could have acquired netelligent.ca for much less...or maybe iweb was more attractive because of the better pool and size of current customers?

    also maybe because iweb owns its datacenter?
    Netelligent now owns his own data center in the Montreal Stock Exchange Tower, it is live since March 2013 and has a 12,000sqft current capacity and a 24,000sqft potential.

    To put things in perspectives iWeb was acquired from it's founders two years ago for 80 million dollars it was bought in majority by a venture capital named NovaCap. This is what venture capitals do they flip the business and sell it for a nice profit

    Same thing happened when Canix got bought out by another venture capital behind Cologix... then everybody knows what happened with prices and cross-connect fees...

    We'll see what will happens now!
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  24. #24
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    Quote Originally Posted by Max_01010 View Post
    Netelligent now owns his own data center in the Montreal Stock Exchange Tower, it is live since March 2013 and has a 12,000sqft current capacity and a 24,000sqft potential.

    To put things in perspectives iWeb was acquired from it's founders two years ago for 80 million dollars it was bought in majority by a venture capital named NovaCap. This is what venture capitals do they flip the business and sell it for a nice profit

    Same thing happened when Canix got bought out by another venture capital behind Cologix... then everybody knows what happened with prices and cross-connect fees...

    We'll see what will happens now!
    nice..thanks for the info
    am beginning to pay attention to your datacenter now..lol
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  25. #25
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    Quote Originally Posted by nokia3310 View Post
    nice..thanks for the info
    am beginning to pay attention to your datacenter now..lol
    My pleasure and happy to hear that I think we are definitely worth the attention now in the Canadian market. Feel free to PM me for a visit!
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