Oct 10, 2003 : The webhost industry: week review

📅 October 10, 2003 - This week was one of outright expansion for the Web hosting industry, beginning with a flood of acquisition announcements and news early in the week, along with reports from several companies regarding expansion and addition to their European businesses.
On Monday, four separate companies announced acquisitions or changes in ownership.
Globix said Monday that it had entered an agreement to acquire managed services provider Aptegrity. Terms of the deal were not disclosed, but Globix said it would acquire substantially all assets and assume specific liabilities of Aptegrity. According to Globix, the deal will provide the company with additional staff, processes, tools and facilities to help it deliver managed application services for enterprises.
Also on Monday, security technology company NetScreen Technologies Inc. announced that it had signed a definitive agreement to acquire SSL VPN technology developer Neoteris Inc. for approximately $245 million in stock and $20 million in cash, including the assumption of all outstanding Neoteris options. NetScreen will pay Neoteris stockholders and option holders up to an additional $30 million in cash. According to NetScreen, the transaction, which is expected to close at the end of this year, will add the Neoteris SSL VPN remote access solution to its portfolio of network security solutions.
Routing service provider Internet Network Services Corporation announced, on Monday again, that it had completed its acquisition of routing company netVmg. First announced last month, the all-stock transaction will see Internet issuing approximately 345,000 unregistered shares of its Series A convertible preferred stock to netVmg shareholders. Internap also announced that it had reached an agreement to buy route control firm Sockeye Networks, and planned to issue $1.75 million in unregistered shares of common stock to Sockeye investors. That deal is expected to close in mid-October.
PSINet Europe said, on Monday yet again, that chairman Andy Ruhan is selling his investment in the company. His shares, and those of his co-investor are to be acquired by the Israel Corporation Group, the company's other major shareholder and now 100 percent owner of PSINet Europe. Ruhan said he would leave the company to pursue other business ventures, though he has been impressed with the company's transformation since acquiring it in June of last year. Gild Shavit of Israel Corporation will take over as chairman, says the company.
And on Wednesday, reports announced that Sprint was close to selling a part of its Web hosting business to VeriCenter Inc. Houston, Texas-based VeriCenter is reportedly planning to take over Sprint's data center facilities in Atlanta, Boston, Dallas and Denver, through an estimated $12.5 million deal that is currently being negotiated. Sprint representatives said the company plans to announce what it has planned for its money-losing Web hosting division some time in the next two weeks.
In addition to acquisitions and ownership changes across the board this week, several US-based companies announced expansions to their UK and European businesses.
On Monday, NaviSite announced that it had renamed its Interliant UK business NaviSite Europe as of October 1, 2003. NaviSite acquired Interliant, along with Interliant UK Ltd, an indirect wholly owned subsidiary, in May of this year. The renamed subsidiary, says NaviSite, will offer a more complete portfolio of services, including colocation services, sophisticated content delivery technology, collaborative application management platforms for systems integrators as well as shared and dedicated messaging and email.
And on Thursday, it was reported that certificate authority GeoTrust Inc. had announced its further expansion internationally with the opening of GeoTrust Europe. The company said it would begin offering its Web security services and digital certificate and identification products to the European market. The European branch will initially offer a limited range of services, including QuickSSL, True Site, True BusinessID and Enterprise SSL. GeTrust Europe will be based in Maidstone, England, and will be responsible for sales, customer support and partner management in the Europe, Middle East and Africa region.
In recent weeks, the Web hosting business has seemed to settle into a comfortable pattern of acquisition scattered in among a variety of other developments. But this week was all about acquisition, with a flood of announcements from an array of communications companies seeking to shore up their offerings as well as solidify or improve their positions in the competitive hosting space.