Donuts to Acquire Rightside Group in $213M Transaction

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Donuts Inc. has reached a merger agreement to acquire Rightside Group Ltd. for approximately $213 million, or $10.60 per share, according to a Wednesday announcement.

The Rightside Board of Directors unanimously approved the merger following a strategic and financial review in the first quarter of 2017.

“Donuts and Rightside have a long history of working together, and we are delighted to take the next step with this transaction,” Donuts Chief Executive Officer Bruce Jaffe said in a statement.“We believe that the combined company will be well positioned to serve our registrar customers and the millions of businesses and individuals who are embracing new ways to brand their online identities.”

Donuts will pay a premium of approximately 12 percent over Rightside’s 30-day trading average and 22 percent over the average enterprise value excluding cash. The all-cash transaction will be completed after tender conditions and the usual regulatory approvals and considerations are met, which is expected to occur in the third quarter. Rightside will become a wholly-owned subsidiary of Donuts, and its shares will be delisted from public markets.

Rightside is being advised financially by Braclay’s Capital Inc., and legally by Wilson Sonsoni Goodrich & Rosati, Professional Corporation. Silicon Valley Bank is providing a credit facility to Donuts, and Perkins Cole LLP is acting as the company’s legal advisor.

Rightside has been Donuts registry for some time, though there was some speculation about the future of the relationship when Google’s cloud-based registry Nomulus, which Donuts contributed to and spun up an early instance of, was released to open source in October. Rightside Group sold its wholesale registrar businesses eNom to Tucows for $83.5 million in January.

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