The Go Daddy Group, the controversial giant of Internet address registration companies, said Friday that it would sell itself to a group led by Kohlberg Kravis Roberts and Menlo Park-based Silver Lake.
While the company did not disclose the financial terms of the deal, the buyers are paying about $2.25 billion, according to people briefed on the matter.
In Go Daddy, the investor group — which also includes Technology Crossover Ventures as a minority partner — will buy the biggest domain name registrar in the world. The company manages more than 48 million domain names and has nearly 9.4 million customers.
When Go Daddy sought to go public in 2006, the company reported $139.8 million in revenue and conceded that it had consecutive annual losses. Since then, however, it has built up its business significantly: It reported $1.1 billion in sales for its most recent fiscal year.
The company’s board hired Qatalyst Partners, the investment bank founded by Frank Quattrone, last fall to explore a potential sale after having been approached by both corporate suitors and leveraged buyout firms.
Go Daddy’s business revolves around steady subscription fees for the registrar and Web hosting services, which are attractive to private equity firms.
Go Daddy is perhaps best-known for its risque advertising, including “too-hot-for-TV” Super Bowl commercials featuring scantily clad spokeswomen like the race car driver Danica Patrick and the celebrity trainer Jillian Michaels.
KKR and Silver Lake executives said that approach is not likely to change.
Robert Parsons, Go Daddy’s outspoken founder and chief executive, said the company planned to expand its offerings, including moving into cloud-based services and aggressively building its international presence.
“This isn’t a sale,” he said in a telephone interview. “It’s a partnership that’s reinvesting in Go Daddy.”
The buyout firms have received financing commitments from their financial advisers, Barclays Capital, Deutsche Bank and RBC Capital Markets, as well as KKR’s own capital markets arm.
