Acquisition Dutch hosting company by an international buyer

• The acquired company is a small hosting company located in the Netherlands
• The acquired company has revenues of less than 1 million EUR
• The buyer is an international hosting group that acquires small hosting portfolios
• CFIE business acquisition input: The CFIE M&A team member helped in sourcing the target company. This acquisition is a valuable addition to the acquirer’s group of companies. The hosting buyer is looking for growth via the acquisition of hosting portfolios globally.

The acquired company focuses on hosting and other related IT services. The hosting portfolio has been built up over a period of 15 years by the company but has no strategic value anymore. Hence, the owner of the hosting portfolio was open to selling this hosting portfolio and focusing on its core activity which is IT services to SME companies in the Netherlands.

The buyer is a midsized international hosting group. The owner started his hosting company in the mid-’90s and was one of the first hosting providers. Quickly, a hosting company of significant size was built up together with a partner. After some years, when the owner moved to Argentina, he sold his shares in this hosting company to his partner. Several years after being established in Argentina a new hosting company, Connaxis hosting S.A was set up. This company has grown steadily and gradually mainly via the acquisition of small and midsized hosting portfolios. Here are some of the characteristics of this international hosting companies acquisition strategy:

• Focus on the acquisition of small and medium-sized hosting companies
• Integrate the new hosting portfolios into the current business of the original hosting company
• Provide high-quality service to the client portfolio so the actual churn rate is minimal
• Achieve high gross margins due to the elimination of all possible costs after the acquisition

The CFIE hosting M&A team helped the hosting buyer mainly in deal sourcing for this acquisition. The CFIE hosting M&A team sees the importance of an efficient hosting industry with high-quality customer support. Many hosting companies have been set up once the Internet came to establish itself in the ’90s of the last century. Now the growth of the plain hosting industry has become much lower and many portfolios are carried on by the current owners. We believe it is more efficient for such hosting owners to sell these portfolios and focus on other activities. The CFIE hosting M&A team has good direct contact with hosting business owners and can support buyers in the acquisition of such smaller hosting portfolios.

Govert Derks scouted the target hosting company, put forward the acquirer’s strategy while explaining the benefits of joining the acquirer’s group of companies. After initiating the talks and negotiations between the hosting target company and the acquirer, CFIE passed on the contact to the hosting buyer that has practical experience in furthering the process of acquisitions of international hosting companies.

• Both companies are active in the hosting industry and the management of the hosting portfolio can be more effectively carried out by one instead of two hosting companies.
• The target company has a strong focus on other ICT-related activities and will get more time to focus on core activities that are not related to hosting.
• The international hosting buyer can invest further in the customer service and management of its hosting portfolio. Also, the group companies can offer additional services to these new customers.
• The clients benefit from getting continued and guaranteed long-term support for their hosting requirements.

Feel free to contact us for further details about this hosting acquisition. If you are looking for acquisitions or business sales of hosting companies in other European countries, do contact us. We know many available hosting targets across Europe and would be able to find the ones that suit you. Please get in touch via the contact form on the right side of this page so we can explain how we can help you in the area of hosting acquisitions or business sales.