Reglikedomain industry desk

Tucows expects $2 million gross margin per year from Melbourne IT buyout

Firm purchased international accounts for $6.0 million on April 1.

Tucows (NASDAQ: TCX) expects its buyout of reseller accounts from Melbourne IT to generate $2 million in gross margin per year, the firm revealed yesterday.

The firm paid $6.0 million to acquire Melbourne IT’s reseller accounts, with the exception of those based in Australia and Fresh Zealand. The buyout closed on April 1.

The deal added 1.6 million domain names under management that generate $13 million in annual revenue.

Tucows didn’t acquire any operations, so its savings on the expense side from the deal amount to not much more “than a few hundred thousand dollars,” Tucows CEO Elliot Noss stated on yesterday’s investor conference call.

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