Private equity firm Siris Capital Group is acquiring Web.com Group for $2.0 billion -- which represents a lofty 10.3 times adjusted EBITDA valuation based on Web.com's 2017 fiscal results. according to ChannelE2E's calculations.
Rumors about a potential Web.com company sale have swirled off and on since about May 2017. The company offers Internet services and online marketing solutions to small and midsize businesses across the Americas and the United Kingdom. Key services include website building, hosting, security, social media marketing and more.
The proposed company sale price represents a 30 percent premium over Web.com’s 90-day volume-weighted average priced ended on June 19, 2018.
However, lawyers at Johnson Fistel aren’t convinced Web.com's board obtained the best price possible, and are looking into whether alternatives to the acquisition were adequately pursued.
Still, some legal firms are known for screaming fire about M&A deals even when no smoke exists. In this case, Web.com can solicit alternative acquisition proposals from third parties as part of a “go-shop” period through August 5, 2018. If a superior offer for the company surfaces, Siris has the right to match it.
The proposed transaction is expected to close in the fourth quarter of 2018, subject to shareholder and regulatory approvals.
Additional insights from Joe Panettieri.
