The CentralNic Group announced another acquisition Monday, with the domain name registry and registrar group announcing it has entered into a conditional agreement to acquire the German/Canadian Hexonet for up to €10 million. Hexonet comprises Hexonet GmbH, Germany, and Mediasiren Advertising, Inc., Canada, and their respective subsidiaries.
It’s CentralNic’s fourth acquisition in the past 12 months, and is the next step in CentralNic’s strategy to rapidly consolidate the global recurring revenue domain name industry. The Group announced in May its acquisition of TPP Wholesale, Australasia’s leading domain name and hosting reseller platform business.
Other acquisitions for the rapidly expanding CentralNic Group have been picking up the domain name portfolio of failed discount registrar AlpNames in March, acquiring GlobeHosting Inc., a leading registrar and hosting provider in multiple markets including Romania and Brazil in September 2018, the parent company of the German Key-Systems, KeyDrive, in July 2018 and the Australian and New Zealand instra group in 2015.
Hexonet has more than a thousand resellers in over 110 countries, managing over 3.8 million domains on its proprietary software platforms. The acquisition will increase by about 28% the number of domains under management on CentralNic’s reseller platforms.
“We are delighted that the Hexonet reseller platform, expert staff and customers are becoming part of CentralNic, boosting not only our recurring revenues and profits, but also our market share and competitiveness,” said Ben Crawford, CEO of CentralNic. “Added to our existing capabilities, the Hexonet acquisition makes us the clear global leader, combining two of the most technically advanced global reseller platforms in the domain industry, and the formidable teams that built and run them.”
In their announcement, CentralNic says Hexonet, like themselves, has a high level of recurring revenues and excellent customer retention. In 2018, Hexonet’s revenues were around €16.5 million (US$19.4m), representing a CAGR of 8% on a US$ basis for the two preceding years, with an EBITDA of c.€0.8m (c.$0.9m). Further, CentralNic is filling staff vacancies budgeted at €0.3m ($0.4m) with staff from Hexonet. Integration is facilitated by the close physical proximity of the German operations of CentralNic and Hexonet.
CentralNic in their announcement state they will provide Hexonet customers with continuity of service, while also upgrading the service with new products, with Hexonet’s CEO and CMO remaining with the business under CentralNic ownership. CentralNic will integrate the innovative technical features, its web apps suite and dropcatching capabilities of the Hexonet platform with those of its own Key-Systems platform, to create an augmented domain platform and service offering, to be released in 2020. Further, the Canadian operations provide CentralNic with an enlarged base from which to cover the Americas in general and specifically the important Pacific time zone markets.