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Rightside Declines Donuts’ $70m Offer For Its gTLDs

Rightside have rejected the Donuts cash offer of $70 million for its entire registry of new generic Top Level Domains “after careful consideration and in consultation with its independent financial and legal advisors”.Partly explaining their rejection, Rightside noted in a news release the “registry business that Donuts has proposed to acquire is the cornerstone of the company’s long-term target model.” The company is targeting annual registry revenue over the next three to five years of between $50 and $75 million. In their most recent financial announcement covering the first quarter of 2016, Rightside said their registry services revenue grew 64 percent to $2.6 million.Currently Rightside have 40 new gTLDs delegated with all but one having entered General Availability and registrations approaching 546,000, or 2.38 percent of all domains registered in new gTLDs, according to nTLDstats.com.The largest new gTLD registry operator by new gTLDs is Donuts with 194 and by registration numbers is xyz.com with over 6.476 million registrations, the largest being .xyz with over 6.458 million.Only time will tell if the Donuts offer is testing the waters and a subsequent higher offer comes in the near future.”Rightside’s Registry business is core to the Company’s strategy and provides the best opportunity to deliver long-term shareholder value. After thoughtful evaluation, Rightside’s Board has determined that Donuts’ proposal significantly undervalues Rightside’s Registry assets,” said Taryn Naidu, CEO of Rightside. “We believe Donuts’ proposal is an opportunistic attempt to acquire Rightside’s valuable portfolio of domain extensions with an undervalued price and in a manner that would not be in the best interests of Rightside shareholders.”Naidu added, “The Board and management are aligned on a clear strategy – building Rightside’s position as a leading domain name company that specializes in delivering new possibilities for consumers and businesses to define and present themselves online. We operate broad distribution assets and have acquired an outstanding portfolio of 40 new gTLDs that map to extremely large addressable markets and the culturally transformative activities that have shaped the world’s use of the Internet. We are well-positioned for growth.””Rightside and its shareholders have many reasons to be excited about the Company’s future opportunities. We remain confident that we have the right people, technology and products to continue to execute on our strategy and maximize shareholder value.”