GoDaddy raises $460m as IPO exceeds market expectations
Web hosting company GoDaddy has enjoyed an extremely successful debut on the stock market.
GoDaddy’s initial public offering (IPO) not only exceeded analysts’ expectations, but performed better than it had anticipated. The technology provider to small businesses priced its shares at $20 each, higher than the estimated range of $17 to $19.
The company has been undergoing a rebranding of late and has been working to establish itself as more than just a domain provider. GoDaddy is looking to promote services to help customers get their websites running, achieve business growth, and to sell them products.
High public confidence
When the stock market opened, shares in the company spiked higher by 34 per cent to the point where the company was valued at $5.48 billion, after shares opened at $26.15. Shares closed back at its opening price after trading in a range of $25.49 and $26.84. This impressive debut highlights how confident the public is in the loss-making firm, due in part to its highly recognised brand name.
GoDaddy now manages around 59 million domain names, employs around 4,000 people, and has a customer base of around 12 million. However, the tech firm is also well known for struggling to cope with its mountain of debt.
Last year, GoDaddy spent around $85 million on servicing its $1.4 billion debt pile, as it struggled to turn the low margins of domain management into profit. Despite this, the firm’s second attempt at being listed stormed to success as it sold all the shares in the offering.
Expanding international presence
Recent developments that focused around expanding the company’s international presence have also been successful. Recent estimates suggest 28 per cent of its customers are internationally based, especially in the noted growth markets of India, Canada and the UK.
GoDaddy’s IPO raised around $460 million from the sale of its 23 million shares and will use part of that to help reduce its overall debt levels, while another part will go towards further reducing operating costs.