Tucows Inc. Announces Acquisition of eNom

2017-01-24 10:05 Posted by: Judy in Domain, News Go to Comment

Surprisingly, Tucows Inc., the leading provider of network access, domain names and other internet services, has released a claim earlier on Jan 20th, 2017 to acquire the wholesale domain name registrar eNom from Rightside Group, Ltd, for $83.5 million.   

As one of the great and long-lived brands in the domain name industry, eNom prides itself on providing the technological infrastructure to support a network of 28,000 active resellers, who as a whole is managing about 14.5 million domains and is estimated to generate nearly $116.5 million in revenue through the third quarter of 2016. Besides domain name services, eNom also offers a wide range of related products like web hosting, SSL certificates, website building software, and email & apps. What attracts Tucows Inc. the most in the acquisition of eNom is, the latter has an outstanding reputation among the resellers as well as end-customers for delivering innovative products and excellent service, according to the President and Chief Executive Officer of Tucows, Elliot Noss.  

It is also said that the Tucows buying eNom will make the total number of its global resellers increase to 40,000 and make that of its domains under management increase to 29 million. Undoubtedly, the Toronto-based company then will slips to second rank in domain name registration business, following the No.1 of GoDaddy.

For so many years since its inception in 1993, Tucows is dedicated to helping people unlock the power of the internet by offering them simple but useful services. After several times of reinventing itself, the company has grown up from a startup software distribution firm to an industry leader in domain name registration and digital services. The main star products of Tucows includes OpenSRS—the first wholesale platform for selling and integrating domain names, hosted email, SSL certificates and web security products, Hover—offering a simple and easy way for individuals and businesses to manage their domain names, Ting Mobile—a mobile phone service that helps US families and businesses save money on their monthly mobile bills, and Ting Internet—fast, reliable, gigabit fiber internet for homes and businesses.

But just as Elliot Noss said that, the industry has changed a lot in the past 15 years, after when eNom and Tucows rolled out wholesale registrar services and the namespace were essentially represented by .net, .com, and .org. And from then on, it gets more and more difficult for a company to succeed in this field. Therefore scale becomes absolutely critical. Through the expanded scale, both Tucows and its investors can benefit from concrete cash flow exchange and an immediate return on investment. 

However, on the other side, there’s still a large group of people wondering what drives Rightside to give up eNom. The only possible explanation should be that the company is looking to cutting off non-essential brands for better focusing on the higher growth and higher margin Registry and Name.com businesses.

According to Rightside’s CEO Taryn Naidu, the divesture of eNom for Rightside is not only the best way to receive increased shareholder value, but also helpful for creating a strong alignment between its vision, strategy, and financial profile. The net cash proceeding from the transaction could be as high as $76.7 million, excluding working capital adjustments. Meanwhile, after paying $4 million of transaction related expenses plus repaying all the debt outstanding under its credit facility, Rightside will be a well-capitalized company with approximately $90 million in cash on its balance sheet.

In other words, both sellers and buyers will benefit from the transaction. And eNom is also believed to move forward and make real progress with the support of Tucows. In terms of some people’s worry that the domain name industry will be entirely monopolized by GoDaddy and Tucows after the transaction, we need to go and keep observing. But one thing for sure is, the domain name registration space has intensified with recent development of acquisition happening one after the other. 

Related Articles

ChinaNetCenter Net Profit Margin Decreases By 33% As Cloud Computing Vendors Jumping Into the Fray
10/16
China’s leading CDN platform provider ChinaNetCenter issued its performance report for the first quarters of the year last Friday, which shows a net income of 522 million to 614 million yuan, decreasing by 33 percent year-over-year to 43 percent.
Week 2017/10/09 Top 5 Web Hosting Industry News
10/13
we carefully collected the major events happening this week in the industry. Hope you can find something interesting things here.
Western Digital Makes New Breakthrough in HDD Technology
10/12
Western Digital develops a new magnetic recording technology with microwave assist.
Sina Weibo Suffers Outage Again, Caused by LUHAN’s Confession Tweet This Time
10/09
Chinese microblogging service Sina Weibo was briefly unavailable yesterday, reflecting sluggish internet speeds, the comment function was suspended and some pages cannot be displayed. The site appeared to be fully restored in less than two hours.
Weekly 2017/09/25 Top 5 Web Hosting Industry News
09/29
There were many exciting news and events happening in the industry this week, and here we conclude the top 5 for you.
Comment
Be the first to comment!
About the author
Judy
Views: 36450
Articles: 137
Having been an website editor for web hosting, SSL, SEO, cloud and domain registration for years. Well knowledgeable about online presence creation, optimization and security.

Author's Hot Articles

godaddy
hub

Hot Posts

Service Recommendation

Cloud Hosting
Cloud hosting is the fastest growing hosting solutions in the industry. »
Cloud Storage
Best Cloud Storage are named based on customer and expert reviews. »
SSL
The most popular SSL certificate providers in the industry are here. »
China Web Hosting
Find out a comprehensive evaluation to the host service provider in China. »
bluehost
Chat Advertising cooperation TOP