Dominion.Domains

Elite Domains portfolio acquisition price upper bound??!!??

Discussion in 'Domain Industry News' started by GeorgeK, Feb 28, 2018.

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  1. GeorgeK

    GeorgeK Leap.com PRO Gold Account VIP ★★★★★★★★★★

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    You might recall that in April 2017, GoDaddy acquired a large portfolio of domain names from Elite Domains (including a bunch of 2-letter .com domains).

    http://dotweekly.com/110k-domains-involved-godaddyelite-portfolio/

    The value of that deal has never been disclosed. However, the latest financial statements might give some clues, although it's very confusing (I've sent emails to GoDaddy Investor Relations, for clarification)

    https://www.sec.gov/Archives/edgar/data/1609711/000160971118000035/a12312017-10k.htm

    it says on page 102:

    It's not clear if those include the Elite domains portfolio. However, it seems unlikely, given that in November 2017 (after the Q3 2017 quarter), they had reported the values of the Donuts and Kevin Ham/Reinvent deals:

    https://domainnamewire.com/2017/11/...ion-two-latest-domain-portfolio-acquisitions/
    https://www.sec.gov/Archives/edgar/data/1609711/000160971117000249/gddy10q-20170930xq3.htm (page 26)

    Given the value of the Elite Domains portfolio (lots of 2-letter .com domains), it seems it should be valued at far more than $2 million ($52 million - $50 million), so it doesn't seem as if that's the 3rd purchase of intangible assets that they're talking about.

    However, on page 100 of the recent filing (same filing used to reference page 102 above):

    https://www.sec.gov/Archives/edgar/data/1609711/000160971118000035/a12312017-10k.htm

    it says:

    Could that be the Elite Domains deal? Its timing matches (April 2017). The valuation seems "reasonable" for a domain portfolio of that quality and size. However, it's unclear why it would be treated differently than the other domain portfolios (Donuts/Reinvent), and not aggregated in that section of the financial report.

    Hopefully GoDaddy Investor Relations can provide some clarity to this, so we can figure out the deal terms.
     
    Last edited: Feb 28, 2018
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  2. stewmath

    stewmath Top Member VIP ★★★★★★★★★★

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    Only the cash part made any sense to me, the rest sounds like gobbledy gook.

    What in the world is a contingent earn-out payment
     
  3. GeorgeK

    GeorgeK Leap.com PRO Gold Account VIP ★★★★★★★★★★

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    Sorry, I'm not 100% sure now if that text is relevant (the various SEC filings seem to conflict; I've emailed GoDaddy Investor Relations, and maybe they can clarify).
     
    Last edited: Feb 28, 2018
  4. GeorgeK

    GeorgeK Leap.com PRO Gold Account VIP ★★★★★★★★★★

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    (deleted, see first post now; seeking clarification from GoDaddy Investor Relations)
     
    Last edited: Feb 28, 2018
  5. Nat Hunt

    Nat Hunt Upgraded Member Gold Account VIP

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    The $50.5 million are classified as "indefinite" lived:
    While a good portion of the April 2017 acquisition is classified as "finite" lived:
    You would think that if they were both acquisitions of domain portfolios, they would both be classified in the same way (either both as "indefinite" or both as "finite"), but who knows. It would be nice if they gave you clarification.
     
  6. GeorgeK

    GeorgeK Leap.com PRO Gold Account VIP ★★★★★★★★★★

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    Right, that was another inconsistency. If there was some non-domain deal in April 2017, then it might be that the Elite Domains portfolio wasn't even accounted for at all in the financial statements.
     
  7. GeorgeK

    GeorgeK Leap.com PRO Gold Account VIP ★★★★★★★★★★

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    I heard back from GoDaddy Investor Relations, and the mystery is solved. That Dotweekly article with the Elite Domains portfolio transaction was in April 2016, not 2017 (my mistake!). Thus, that transaction price is still a mystery, because it would have been consolidated with other portfolio acquisitions in 2016. Sorry for the confusion.
     
  8. GeorgeK

    GeorgeK Leap.com PRO Gold Account VIP ★★★★★★★★★★

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    Going back to the 2016 GoDaddy annual report,

    https://www.sec.gov/Archives/edgar/data/1609711/000160971117000042/gddy-12312016x10k.htm

    pages 95 and 96 do allow us to put an upper bound on the Elite Domains portfolio of $59.3 million (said outright on page 95, and also via page 96, the $120.5MM gross carrying amount at the end of 2016 minus the $61.2MM gross carrying amount at the end of 2015. But, there could have been other domain portfolios in that figure, so it's unclear how much was just for the Elite Domains portfolio.
     
  9. Acroplex

    Acroplex Top Member DomainGang.com PRO VIP ★★★★★★★★★★

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    Just email Anthos with a "hey, malaka, what was the $$$" :-D

    j/k
     
  10. Alessandro Couteau

    Alessandro Couteau Active Member VIP

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    You would think people wouldn't waste their time going through SEC filings ;)
     

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