Cinven Group Ltd. agreed to purchase the capital of Host Europe Group Ltd. The purchase of the Internet hosting and domain firm, would be made from Montagu Private Equity.
According to the agreement, Cinven will pay Montagu GBP 438 million, or about US $667 million. The amount represents 13.8x earnings before interest, taxes, depreciation and amortization (EBITDA).
In a statement, Cinven said that the rapid growth of the hosting industry gave a compelling reason for them to buy Host Europe. It said the market itself is ready for consolidation because of the many associated businesses related to the core hosting operations.
Montagu acquired Host Europe from Oakley Capital Private Equity for GBP 222 million in October of 2010. Host Europe employs 600 workers and operates in Germany, Spain and the UK.
To date, Host Europe serves 1.5 million customers through domain registration and website hosting. The sale served as the sixth exit of Montagu this year alone.
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