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CentralNic now owns .sk after $30m deal closes

Kevin Murphy, December 12, 2017, Domain Registries

CentralNic has just closed its acquisition of SK-NIC, the ccTLD operator for Slovakia, the company announced today.

The London-based firm announced the deal back in August, when it was to be worth €21.27 million up front, with a deferred performance-related cash payout of €4.85 million cash over three years.

But the deal, originally intended to close in September, was delayed by legal “complexities” and restructured from an asset purchase to a purchase of SK-NIC, including its liabilities, in its entirety.

The purchase price is now €20.27 million in advance, with €5.85 million deferred. That’s still a total of €26.12 million ($30.67 million).

The acquisition is unusual in that it sees a ccTLD transferring to control of a foreign entity, and was opposed by many in the Slovakian internet community.

A petition was organized calling for the transfer of .sk to a new independent body with more community and government oversight.

There had been fears that CentralNic would do to .sk what it has to Laos’ .la — repurpose it to mean something other than “Slovakia” — but CentralNic told DI that it will no do so.

The deal means .sk will move from its outdated old registry infrastructure to CentralNic’s standards-based EPP platform, which should make it easier for registrars to integrate.

It’s also likely to mean it’s going to be much easier for non-Slovaks to be able to register .sk domains.

SK-NIC currently has about 360,000 domains under management.

CentralNic promises $30 million .sk will only ever mean “Slovakia”

Kevin Murphy, August 30, 2017, Domain Registries

CentralNic has committed that it will not repurpose Slovakian ccTLD .sk to mean anything other than “Slovakia”, following its purchase of SK-NIC this week.

The acquisition of the Bratislava-based registry, which will cost between €21 million and €26 million ($25 million to $31 million) depending on performance, has been controversial in Slovakia, with many leading registrars campaigning against the sale.

One of the charges leveled against CentralNic was that its modus operandi has been to market ccTLDs as if they have other meanings. It markets Laos’ .la as a TLD for Los Angeles, and acts as the back-end for Palau’s .pw, which is marketed as an acronym for “Professional Web”.

“From a technical point of view, it’s definitely a good acquisition. CentralNic has a good system that is stable and working well, but we don’t agree with their sales and marketing policies,” Ondrej Jombik of Slovak registrar Platon told DI today.

Jombik is the person who organized a petition against the sale that attracted almost 10,000 signatures.

“We don’t agree with how they manage national TLD registries,” he said. “What they do in Palau is not acceptable. What they do in Laos is not acceptable. We’re kind of scared what they plan to do with our domain, how they plan to market it.”

But CentralNic CEO Ben Crawford said in an email interview that these concerns are misplaced. He said:

CentralNic has never had plans to repurpose .sk, and CentralNic commits not to market it with any other meaning than as the Slovak country code. Moreover, while some of the ccTLDs we work with welcome the export revenues from repurposing their TLDs, such practices are specifically restricted under recent contractual requirements put in place by the Slovak Government in response to this concern being raised by SK-NIC’s policy committee.

Jombik’s petition, which claimed to be supported by 13 of the top 15 .sk registrars covering 73% of .sk’s 360,000 domains, called for the ccTLD to be handed over to a “new independent non-profit organization” that more fairly represented the Slovak internet community.

But Crawford said that .sk already has strong community representation, which is guaranteed by the registry’s contract with the Slovak government.

“I am honestly unaware of any ccTLD where the Government, the internet community in general and the registrars all have such a defined and important role,” he said, adding:

There will be changes under our management: The Government contract has recently been beefed up placing further stability and disclosure responsibilities on SK-NIC, including escrowing the registry data to the Government cloud, a formalised Service Level Agreement, giving the Government the right to audit SK-NIC’s performance, etc., all of which we will abide by. We have other ideas too on contributing to the Slovak internet, and we are planning to hold discussions with not for profits, industry associations, Universities and other such entities in Slovakia, to seek their guidance on the best ways to do this.

Whether these promises and actions will be enough to assuage critics of the deal, who are also motivated by a sense of national pride and aggrieved that what is arguably a national resource is falling into foreign hands, remains to be seen.

Having a ccTLD manager acquired outright by a foreign entity without a redelegation by ICANN/IANA is an unusual occurrence. Only the $109 million acquisition of .CO Internet by US-based Neustar back in 2014 springs to mind.

Donuts to complete Rightside acquisition tonight

Donuts is on the verge of closing its acquisition of coopetitor Rightside, after the vast majority of Rightside shareholders agreed to sell up.

Rightside just disclosed that owners of 92% of its shares — 17,740,054 shares — have agreed to sell at Donuts’ offer price of $10.60 per share.

That means the remaining 8% of shares that were not tendered will be converted into the right to receive $10.60 and Donuts can close the acquisition before the Nasdaq opens tomorrow morning.

After the $213 million deal closes, Rightside will become a wholly owned subsidiary of Donuts and Donuts can get on with implementing whatever efficiencies it has identified.

Rightside will cease to be publicly listed afterwards.

Together the combined company will be the registry for about 240 new gTLDs, as well as owning its own back-end registry infrastructure and the retail registrar Name.com.

GoDaddy flips hosting business for $456 million

GoDaddy has sold off its recently acquired PlusServer business for €397 million ($456 million).

The buyer is a private equity firm, BC Partners.

The registrar had taken control of the business when it spent $1.79 billion on Host Europe Group earlier this year, but had said from the start that the asset was for sale.

PlusServer sells hosting to larger companies, which have more demanding support needs that small-business-focused GoDaddy is accustomed to dealing with.

The unit was bringing in annual revenue approaching $100 million per year.

GoDaddy said it planned to put the proceeds of the flip towards paying off some loans.

ICANN gives the nod to Donuts-Rightside merger

ICANN has given its consent to the acquisition of Rightside by rival new gTLD registry Donuts, according to the companies.

The nod means that one barrier to the $213 million deal has been lifted.

Rightside, which is listed on Nasdaq, still needs the majority of its shareholders to agree to the deal and to satisfy other customary closing conditions.

ICANN approval does not mean the organization has passed any judgment about whether the deal is pro-competition or anything like that, it just means it’s checked that the buyer has the funds and the nous to run the TLDs in question and is compliant with various policies.

All new gTLD Registry Agreements given ICANN the right to consent — or not — to the contract being assigned to a third party.

The acquisition was announced last month at the end of a turbulent year or so for Rightside.