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Vector Capital in $200m Register.com deal

The New York-based domain name and hosting business has agreed to be acquired for $7.81 per share in an all-cash deal.

Vector Capital is to acquire Register.com in a definitive merger transaction valued at approximately $200m (€162m).

Vector Capital, based in San Francisco, said that it was attracted to Register.com’s customer base, customer service and well-known brand.

Founded in 1994, the business is one of the internet’s longest standing providers of global domain name registration for businesses and consumers, managing approximately 2.9 million domain names.

Register.com’s board of directors has approved the transaction and merger agreement, and has recommended that its shareholders follow suit. The deal is expected to close in the fourth quarter of this year.

The deal will see Register.com shareholders receive $7.81 in cash for each share of common stock and follows a bid in June by RCM Acquisition to acquire the company for $7.10 per share, which was rejected as ‘inadequate’.

The RCM bid was affiliated with James Mitarotonda, a member of Register.com’s board of directors, and after its rejection, Register.com began its sales process.

The offer from Vector represents a 21 percent premium over the closing price of Register.com’s shares on June 8th, the last trading day before RCM publicly disclosed its interest in the company, and around an 18 percent premium over the average closing price for the last 90 trading days.

VeriSign, a provider of infrastructure services for internet and telecommunications networks, sold its domain name registrar Network Solutions to Pivotal Private Equity in October 2003 for approximately $100 million.