United Internet Sells Web Hosting Stake to Warburg Pincus

In a move that’s shaking up the web hosting world, private equity firm Warburg Pincus is set to buy a third of United Internet’s 1&1 web hosting business. The news means an IPO for the German-owned business will now be delayed beyond next year – a setback that will arguably cause a pinch of controversy, considering the company’s original goal was to be publicly listed by 2017.

However, the deal is said to offer its fair share of advantages to the web hosting business, believed to be a positive move that will pave the way for greater future potential.

The deal will reportedly provide more opportunity to invest in the business and make acquisitions

Warburg Pincus is set to pay up to 450 million euros for the stake in United Internet’s 1&1 brand. This will now set the value of the business at 2.55 billion euros, including debt: an overall price tag that boosts the business’s valuation by an impressive 12.5 times.

United Internet has also reported that the deal will offer greater flexibility when it comes to determining strategic options for the coming years.

What is United Internet?

United Internet is perhaps one of the most prominent web hosting companies right now. Its services include the provision of home pages and marketing tools to small and medium-sized companies and freelancers, making it a popular and highly-accessible option for businesses and start-ups. While the company may be pushed back for an IPO right now, it’s determined to create the stepping stones to attain this goal and continue elevating its status in the world of web hosting.