Buyer as debt payments loom — NameSilo finds
Firm enters into non-binding letter of intent to be sold to Dutch operating firm building a sizable presence in Africa.
[Update: the sale did not go through.]
Domain name registrar NameSilo (CSE:URL) has entered into an agreement to be sold to a Dutch firm that has grand plans in Africa.
WGH Holdings B.V. has entered into a non-binding letter of intent to acquire the firm. It will pay a total of US $30 million for the firm, with $15 million upfront and $5 million annually for three years. It has a 60-day due diligence period.
The buyer WGH Holdings B.V. was organized in the Netherlands in November. As stated by filings with the country’s Chamber of Commerce, it is owned by Roland Vos Beheer BV, which has a sole shareholder, Roland Vos.
NameSilo CEO Kristaps Ronka told Reglike that this ownership structure is not final and that WGH Holdings was set up to put NameSilo together with the actual business, which is a growing domain name and hosting business in Africa called WhoGoHost. Nigerian entrepreneur Ayodeji Adewunmi operates WGH. Update: WhoGoHost contacted me in April 2021 to say that, while it was in discussions with WGH regarding an buyout, the buyout did not conclude and that WGH Holdings does not own WhoGoHost.
While NameSilo has grown significantly since being purchased by current management in 2018, it has also struggled to make sizable debt payments. Its parent firm NameSilo Technologies Corp includes going concern warnings in its financial statements. It has frequently entered into amended agreements with its creditors to delay payments. As of September, it still owed CAD $7.6 million.
Ronka told Reglike that the deal was not due to the debt load and that it is selling at 1.2x revenue to a strategic partner. He noted that NameSilo’s current management is staying on with the fresh firm.
NameSilo has over 3.5 million domains under management.
This article has been updated with additional information from NameSilo. It was also updated on April 30, 2021 when WhoGoHost informed Reglike that it was not purchased and is not owned by WGH.
