HgCapital Trust plc, has announced that it has agreed the sale of NetNames, a provider of global brand protection and internet domain name management services, to CSC, a US-based, provider of business administration services to corporations.
The terms of the transaction were not disclosed. However, the trust which participates in all HgCapital’s investments alongside its institutional clients, will realise cash proceeds of approximately £14.3 million on completion of the transaction.
Companies House filing for the year ended 2015 states that NetNames recorded flat revenue of £53m. However, loss before tax climbed to £20.89m, up from a £19.48m loss in the previous year.
Philip Carse, analyst at Megabuyte, said :
When NetNames went private it had a relatively unblemished track record of growth and profitability, since then corporates have simply not adopted the multitude of Generic top-level domains expected.
Carse also added that NetNames was not in its lower-than-expected domain name business alone and many web hosts have also been hit by slower gTLD demand. It it however assumed that CSC’s offer was sufficient for HgCapital to draw a line under NetNames ownership approaching the fifth anniversary, whilst for CSC it is too small a deal to even bother reporting.