If you're new to Cheap Hosting Directory, you may want to subscribe to our RSS feed. Thanks for visiting!

Atlanta, Georgia - (Cheap Web Hosting Directory) - June 29, 2007 - Web hosting Internet services company, Web.com, has entered into a definitive merger agreement with Website Pros, which will unite the companies with an annualized revenue of over $117 million and over 234,000 paid subscribers.

Under the terms of the agreement, which was unanimously approved by the boards of directors of both companies, Web.com shareholders may elect to receive for every Web.com share either 0.6875 shares of Website Pros stock or $6.5233 in cash, subject to proration so that the total cash paid shall equal $25 million. In the aggregate, Website Pros will issue approximately 9 million shares of Website Pros stock and pay $25 million in cash. In addition, Website Pros will assume all of the outstanding options to purchase common stock of Web.com at an exchange rate consistent with the value offered to holders of Web.com common stock. Based on the closing price of Website Pros’ stock on June 26, 2007, the transaction is valued at an aggregate purchase price of approximately $129 million.

The merger, which is subject to regulatory reviews and approvals, approval by the shareholders of both companies and certain other customary conditions, is expected to close during the second half of 2007.

David Brown, President and CEO of Website Pros explained, ”The combination of Website Pros and Web.com represents a milestone event in the highly fragmented web services market for small and medium-sized businesses, and is an investment in growth and scale that expands the customer base and value proposition for both companies. Web.com is highly synergistic with Website Pros from a product and services offering, market focus, and distribution channel perspective. Website Pros’ Do-It-For-Me web services, outbound sales and proven lead generation partners coupled with Web.com’s Do-It-Yourself web services, online marketing expertise, and complementary channel of SMB-focused partners make for a formidable player in the industry. The SMB market is very large with over 25 million SMBs in the U.S. alone, and I am excited to work with Jeff Stibel and his excellent team ensuring that our combined organization capitalizes on this tremendous opportunity.”

Jeff Stibel, President and CEO, Web.com added, ”We are very pleased that our success since new management took over in August 2005 has led to an approximate 200% increase in shareholder value and has positioned Web.com to realize further value through a merger with Website Pros. Over the last two years, the company has restored and accelerated top line growth, generated record levels of subscriber growth and has significantly improved its operational and financial performance. This complementary merger is a logical next step that has the potential to create substantial value for customers, partners and shareholders of both Web.com and Website Pros.”

There are a number of strategic reasons supporting the merger, including the following:

– Over $117 million annualized revenue run rate
– Over 234,000 paying subscribers
– 21 patents with several pending
— Industry-leading partnerships
– Comprehensive web services for SMBs

Website Pros is the leading provider of Do-It-For-Me web services solutions, while Web.com is a leader in providing Do-It-Yourself web services. The combined company hopes to be positioned to meet the diverse set of needs across small business customers and partners alike, thereby significantly expanding the addressable market opportunity for each individual company.

Significant cross-selling opportunity — Website Pros has continued to expand its SMB solutions beyond web services, including offerings from Leads.com, RenovationExperts.com, 1ShoppingCart and Submitawebsite. In addition, Web.com has expanded its capabilities with the introduction of services such as Microsoft Exchange hosting and partner offers. With over 234,000 paid subscribers, there is a significant opportunity to cross-sell value-added solutions to each of the respective customer bases.

Highly complementary sales channels — Website Pros’ revenue growth has been driven by its outbound sales organization, which manages and pursues leads from its partner channel that includes brand name enterprise companies in the financial, printing and technology sectors that have a large base of SMB customers. Web.com has accelerated its revenue growth through execution of an efficient marketing strategy and growing partnerships with companies that also service the SMB market, including yellow pages providers. The complementary nature of the two companies’ sales channels will enable the combined company to more effectively reach a far broader range of SMB customers than either company could do individually.

The companies believe there are significant opportunities for operating cost synergies through the integration of the two businesses, which is expected to result in pre-tax savings of approximately $5 million to $7 million during calendar year 2008. The merger is expected to be accretive to the combined companies’ non-GAAP diluted earnings per share in its first full year (CY2008), and is expected to break even on a GAAP earnings per share basis by the fourth quarter 2008. In addition to benefiting from the growing momentum in Web.com’s standalone business, the companies expect to capitalize on growth opportunities resulting from complementary products, channels, and geographic presence.

David Brown will continue in his role as Chairman and Chief Executive Officer of Website Pros. Jeff Stibel, the current President and Chief Executive Officer of Web.com, will become President of Website Pros, in addition to joining its Board of Directors. Including Mr. Stibel, Web.com representatives will hold two of seven seats on the combined company’s Board of Directors.

Friedman, Billings, Ramsey and Co, Inc. acted as financial advisor and Cooley Godward Kronish LLP acted as legal advisor to Website Pros. RBC Capital Markets acted as financial advisor and Stubbs Alderton and Markiles, LLP acted as legal advisor to Web.com.

Website Pros is a provider of Do-It-For-Me website building tools, Internet marketing, and lead generation solutions that enable businesses to maintain an effective Internet presence. The company offers a full range of web services, including website design and publishing, Internet marketing and advertising, search engine optimization, customer support and technology, and lead generation for general and online e-commerce web sites.

Web.com, formerly Interland, Inc., offers do-it-yourself and professional website design, website hosting, ecommerce, web marketing, developer hosting, and e-mail resources, since 1995.More than 4 million websites have been built using Web.com’s proprietary tools, services and patented technology. As one of the longest-standing leaders in the website hosting industry, Web.com offers proprietary, point-and-click technologies and expert support professionals to ensure simplicity and ease-of-use at every step of the process. Distribution Partners include: Yellow Pages directories, broadband services, telecommunications, retail, and others. Strategic distribution partners include: R.H. Donnelley, Dex Media, EarthLink, British Telecom, Terra Lycos, Thomas Publishing, Ambassador Yellow Pages, Hawaiian Telcom, Encore Software, Office Depot, CompUSA, Amazon.com, and Monster Worldwide. Technology Partners include: Cisco, Compaq, Foundry Networks, Google, Hewlett-Packard, Lycos, Macromedia, Miva, Microsoft, Network Associates, Openwave, PayPal, RealNetworks, Red Hat, Staples, Sun Microsystems, VeriSign, Verizon, VERITAS, Yahoo, and WebTrends. The company’s web hosting and website building services can also be found under the Interland (www.interland.com) and Trellix (www.trellix.com) brands.

Web.com has been honored with the following accolades:

• Deloitte, Technology Fast 50 Winner, 2005 and 2006
• Excellence in Technology 2005 Awards – Ecommerce, SmallBusinessComputing.com
• # 12 on Deloitte’s 2004 Technology Fast 500
• #1 Web Design, Development and Services Company 2005, Atlanta Business Chronicle
• Frost and Sullivan Market Leadership Award 2003
• Who’s Who in Technology 2003 and 2004, Atlanta Business Chronicle

To learn more about Web.com, please visit: www.web.com.

For more information about Website Pros, please visit: www.websitepros.com.

Related posts brought to you by Yet Another Related Posts Plugin.