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2012 Web Hosting Industry Year in Review – An Year Rife With Mergers and Acquisitions

One thing that was rife in Web hosting industry in 2012 was  that large web hosting companies and IT service providers made  multiple mergers and acquisitions to expand their portfolio of hosting properties.

The largest acquisition, though came pretty late in the year, with   Canadian telecommunications provider Cogeco Cable’s purchase of cloud and managed hosting provider PEER 1 Network Enterprises. Announced in late December, the deal saw Cogeco acquire PEER 1 at a price of $526 million on a fully diluted basis, and an enterprise value of approximately $635.

Six months prior to it,  PEER 1 itself acquired UK managed hosting provider NetBenefit for $38.7 million in cash.

Edurance International group was also a front-runner in the acquistions race. It all started in August when they purchased web hosting service Intuit websites business from software biggie Intuit. They continued this spree and in late December bought web hosting provider Hostgator for a mammoth $225.

Other web hosts in the Endurance web hosting portfolio include FatCow and BlueHost  and the above mentioned two acquisitions added more to it.

The surprise visit of the year was by web hosting provider 365 Main which had been absent from the data center market since 2010 when its sold its five properties to Digital Realty Trust, only to bounce back this December by acquiring 16 of Equinix’s data centers.

Cisco too, made two major acquisitions this year, both of which closed in final quarter of 2012. It started in November when Cisco Systems  announced a deal to buy San Francisco-based Meraki, a player in cloud networking, for $1.2 billion in cash and retention-based incentives. This was followed by Cisco’s acquisition of cloud and data center management and automation provider Cloupia for $125 million in late December.

British managed services provider Claranet made three big acquisitions this year, acquiring French web hosting provider Typhon for $5.51 millionmanaged services provider Star Technology Services and Portuguese web hosting provider CGEST.

Akamai Technologies, Inc. acquired FastSoft Inc. in September , a provider of content acceleration software, in a cash transaction. The acquisition is expected to complement Akamai’s cloud infrastructure solutions with technology for optimizing the throughput of video – and other digital content – across IP networks.

Topping the list however is  UK web hosting provider Six Degrees, which made 5 acquisitions in 2012. The year began for them in February when they  completed the acquisition of Ultraspeed, a London-based managed hosting and managed cloud provider. In may, they first acquired datacentre interconnection business DataHop , which was followed by their announcement of the acquisition of  two London-based firms Firstserv and Serverstream, both managed hosting, cloud and complex hosting providers founded over 10 years ago.

They wrapped it all up in December, with their announcement of acquiring cloud hosting provider Cloud Computing Centre.

Are there any other notable mergers and acquisitions that we may have missed? Feel free to mention them in the comments below.

About author:

Dakshesh Verma is a Content Writer and Brand Executive at ZNet. He is an avid movie watcher and a reading buff.


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1 Comment

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