CentralNic plc,(AIM:CNIC) acquires Internet.BS for a maximum consideration of USD 7.5 million. The company put out a press release early this morning. They mentioned that Internet.BS is a top 30 domain registrar.
Internet.BS is a profitable, cash generative business delivering unaudited operating profits and profits after tax of USD 730,000 for the year ending 31 December 2013. The acquisition is expected to be earnings enhancing from day one, excluding transaction costs.
CentralNic gave some talking points on how the acquisition will affect their company going forward:
Impact of the Acquisition
The acquisition of Internet.BS is a strategic step for CentralNic, which will position the Company as a vertically integrated platform offering domain names at retail as well as wholesale – one of the key objectives announced at admission to AIM in September 2013.
Key strategic drivers for the acquisition include:
- Gaining a proven retail platform already supporting 28,000 users in eight languages, including sophisticated administrative tools for domain portfolio owners;
- Enhancing the revenues and profits of CentralNic with an additional cash generative business retailing domains to consumers and other domain name retailers; and
- Optimizing the earnings opportunity for CentralNic presented by the new Top-Level Domains by giving it access to the retail margin for sales of these domains.
The Board believes that the deal terms are attractive, at under 10x EBITDA, with 35% of the consideration settled in shares.
We continue to see consolidation in the domain space and this is a trend that will most likely continue in the future.