Cloud services provider DigitalOcean Holdings Inc. has agreed to buy website hosting firm Cloudways for $350 million in an all-cash transaction.
DigitalOcean will acquire malta base Cloudways in order to acquire more small and medium-sized company clients. The sale is expected to finalise in September, with a “substantial amount” of the $350 million paid over a 30-month period after the acquisition’s completion, DigitalOcean said in a statement Tuesday.
Read Also: Germany and Canada have signed a hydrogen deal.
According to bloomberg, the two companies have been collaborating since 2014, with around half of Cloudways’ customers currently utilising DigitalOcean.
“We have always felt like we were a part of the DigitalOcean team, therefore we are delighted to officially become a part of the firm,”
Cloudways Chief Executive Officer Aaqib Gadit said in a statement.
DigitalOcean announced a 29% increase in revenues to $133.9 million and a net loss of 6 cents per share for the fiscal quarter ended June 30 earlier this month.
The transaction is projected to boost DigitalOcean’s revenue growth by $13 million to $15 million in the current fiscal year, but it will not influence the company’s annual margin forecast issued in August, according to a statement.
Read Also: Qatar is preparing to buy stakes in Pakistan’s Roosevelt Hotel.
Cloudways revenue is estimated to approach $52 million in fiscal 2022, representing a three-year compound annual growth rate of more than 50%. According to DigitalOcean, the firm produces free cash flow.
DigitalOcean decided to go public in March 2021, and the stock has plunged 68% from a November high to $41.96 as of Monday’s closing, which is below IPO levels.
