Ancestry.com, the publicly traded online genealogy site, is being purchased by Permira, a European private equity firm, for $1.6 billion.
The purchase price of $32 a share is a 9.7% premium from Friday’s closing price. Shares were up 7.9% in premarket trading on the news.
The purchase price is a 41% premium from its closing on June 5
Ancestry.com went public in 2009 and is 15 years old.
The site has more than 2 million paying subscribers.
Wow.
Wow too!
A very nice price on a solid business model, at 4x annual revenue of $400M. But one has to keep in mind that the company was founded in 1983, so this payday took a lot of work and years to get to. I was writing software for the Apple II back then, so it seems like a lifetime ago.
On a side note, I’d much rather have 2 million (and growing) paying subscribers than a billion fickle free ones. I think Ancestry.com should easily be in business for another 29 years, while who knows what will have replaced Facebook by then. Will MySpace make a comeback? While I’m not a huge patron of social sites, MySpace’s video of its upcoming redesign does look interesting.
Grim is absolutely right! This is an incredible business that has a nice domain name. Unlike other internet IPOs and hype companies that are incredibly successful and have a loyal subscriber base. The big take away is they make money and lots of it! They also have nice cash on hand and no debt.
Take a look at my article: http://youthfulinvestor.com/ancestry-com-sells-1-6-billion-largest-domain-sale/ as I investigate why the company is worth 1.6 billion and why it is not just the domain name which many people are getting confused by.