Press Releases
SOURCE: Tier1 Research

WACHOVIA CAPITAL PARTNERS ACQUIRES HOSTMYSITE

By Philbert Shih
Tier1 Research
June 4, 2008

(excerpted) -- HostMySite, a privately held hosting provider based in Delaware, will disclose that it has been acquired by Wachovia Capital Partners, the private equity arm that is aligned with Wachovia Bank, in a deal that has been in the works for about six months.

The valuation details were not disclosed, but T1R estimates this to be anywhere from a $50-60m dollar deal. HostMySite exited 2007 with around $25m in revenues and is projecting strong Y/Y growth, which T1R believes to be in the 25-35% range. HostMySite continues to focus on dedicated servers and managed services, with a rough 60-20-20 dedicated, VPS and shared hosting mix. This mix has trended toward dedicated (which includes a growing managed component) over the last several years.

HostMySite was founded in 1997 by CEO Lou Honick and Neil Heuer and has focused on serving the hosting needs of the consumer and SMB market. Based in Delaware, the company is headquartered out of a building on 350 Pecander Street, which covers 18,000 square feet – 10,000 square feet of datacenter space (now SAS Type II certified) and 8,000 square feet of office space. The existing office space is now being converted into datacenter space, and the company will move its headquarters down the street to 650 Pecander Street. This building, covering 26,000 gross square feet, was leased in 2006 and was supposed to accommodate HostMySite's next expansion phase. Management estimates the expansion will house up to 280 cabinets, or about 8,000 servers. Another 5,000 square feet of office space at nearby Chapman Road will also be folded into the 650 Pecander Street headquarters. Our last headcount for HostMySite was around 150, and it's not likely that the company is much larger than that at the moment.

HostMySite was advised by DH Capital, well known to specialize in hosting transactions and advisory services.