GoDaddy Prepares for IPO
GoDaddy Group Inc., the Internet company that helps individuals and businesses create websites, is preparing for an initial public share offering, said people familiar with the matter.
The Scottsdale, Ariz., company, which provides domain-name registration and website-hosting services to more than 12 million customers world-wide, in the coming weeks plans to interview banks that would lead the underwriting of its IPO, the people said. Based on a typical IPO time frame, the company’s shares could begin trading in the second half of the year.
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An IPO for GoDaddy, a 17-year-old company that initially drew attention for its edgy commercials featuring scantily clad women, would be the latest in a rush of such deals as stock indexes trade near record highs and investors clamor for shares in newly listed companies. The first two months of 2014 marked the busiest start to a year for IPOs since 2007, according to data provider Dealogic. A number of high-profile IPOs are set to begin trading in coming months, including those of boutique investment bank Moelis Co. and King Digital Entertainment PLC, the maker of the popular “Candy Crush Saga” mobile-phone game.
A competitor to GoDaddy in the hosting business, Endurance International Group Holdings Inc., went public in October. Its shares were up 18% since then.
Private-equity firms are flocking to the IPO market to list companies they’ve owned for several years in the hopes of reaping outsize profits while share prices remain high. KKR Co., Silver Lake and Technology Crossover Ventures acquired GoDaddy in 2011 for $2.25 billion. It remained unclear what valuation the company might secure in an IPO, though it’s expected to significantly exceed that.
GoDaddy’s revenues are expected to grow by a “high-single-digit percentage rate” in 2014, according to a January report by Standard & Poor’s Ratings Services. S&P said it expected cash profits to grow at a “slightly lower rate” because of higher costs as the company invests in its growth. The company has been offering new products and expanding overseas, while also opening new offices and a technology center in the U.S. It currently manages 57 million domain names.
GoDaddy has lately moved away from provocative ads, with Super Bowl commercials earlier this year featuring a woman telling her boss with a puppet she is quitting her job and bodybuilders racing down the street and descending upon a spray-tanning salon.
GoDaddy was founded in 1997 by Bob Parsons, who until recently was CEO. In 2012, GoDaddy named Blake Irving, then Yahoo Inc. YHOO +0.99% ‘s chief product officer, its new CEO. Mr. Irving last year indicated an IPO for the company could be in the offing.