Basefarm has acquired the web hosting company WebDeal. The acquisition will allow Basefarm to leverage operational synergies and take advantage of new strategic opportunities. It will also result in a collaboration in the field of cloud computing.
— WebDeal offers a very strong technical environment in areas that we wish to strengthen, especially those involving products and solutions based on IBM technology. We will also achieve cost synergies through better utilization of our data centers, among other things, said Grethe Viksaas, CEO, Basefarm.
Basefarm has established a solid market position delivering high-level, mission-critical operational and IT-related services to media companies, directory services, public sector organizations and e-commerce businesses. WebDeal’s strength lies in areas such as SaaS (Software as a Service) and optimal utilization of infrastructure based on customers’ usage patterns.
– By joining forces with a strong organization such as Basefarm, our core areas of business will be developed significantly faster and more effectively, said Jan Aril Sigvartsen, CEO, WebDeal.
Both companies are financially healthy and have enjoyed continuous growth since they were established. Basefarm has made into the selective list of Norwegian companies called "gasellebedrifter" five times, and WebDeal has been on the list in 2008, 2009 and 2010. The list is produced by Norwegian business magazine Dagens Næringsliv.
To be considered a “gaselle”, the company must have, in the previous four years: 1) at least one million NOK revenue per year; 2) delivered approved balance accounts; 3) at least doubled the revenue; 4) a positive result every year; an 5) increased the revenue each year.
WebDeal has high expertise in IBM platforms (such as Power and System z servers, as well as Rational Software), Novell Suse Linux Enterprise Server, Moodle and eZ publish CMS.
Basefarm’s expertise encompasses a wide range of web-related services and solutions, including search engines, e-commerce and publishing platforms, Java, Oracle, Linux, Solaris and Windows. Basefarm also monitors and maintains interfaces between customers' Internet solutions and related systems.
Both companies have come far in developing cloud-based services, Software as a Service (SaaS), Platform as a Service (PaaS) and Infrastructure as a Service (IaaS).
— I look forward to expanding our range of services in these areas within a much larger and more scalable environment, said Sigvartsen.
He also points out that their joint efforts will allow them to offer both deeper and wider services to an international clientele.
The acquisition is supported by Basefarm's majority owner, Reiten & Co. They took over majority ownership of the company in December 2009. Reiten & Co. is an active shareholder, and contributes especially in identifying new strategic possibilites such as this acquisition.
— The acquisition is in accordance with Basefarm's goals and will lead to further growth. WebDeal has an international contact network that we want to take advantage of when further developing Basefarm, said Christian Melby, partner, Reiten & Co.
Grethe Viksaas believes the acquisition will give customers and partners access to the best the two companies have to offer, each in their own areas of expertise.
— Joining forces with WebDeal strengthens our position as a solid technical environment in Scandinavia when it comes to web services. It also contributes to making us the natural first choice for customers who want services in the cloud, she said.
According to Viksaas, Basefarm will also strengthen its relationship to partners, forming alliances with software companies that wish to make their products available through cloud-based SaaS and PaaS.
The two companies had a turnover of approximately NOK 295 million in 2010, and have 215 employees between them.
WebDeal is a specialized provider of server hosting and maintenance services, with headquarters in Oslo, as well as branch offices in the United States and United Kingdom. WebDeal had a turnover of NOK 18 million in 2010, and operating profits of around NOK one million. The company has 18 employees. WebDeal is owned by employees and founders, as well as Edda Media. Their customers include Expert, Mediehuset Tek, Edda Media and Hjemmet-Mortensen.
ABOUT REITEN & CO
Reiten & Co is one of the leading private equity companies in the Nordic countries and consists of an experienced investment team that has together created substantial values. The company has investment experience in many sectors and primarily invests in medium-sized Norwegian and Nordic companies.
Reiten & Co was established in 1992 and since 1996 has established the company’s private equity activities as a Nordic leader, with about NOK 3.3 billion under management. Reiten & Co invests in ambitious growth companies and brings to the companies in the portfolio financial and strategic expertise, experience and drive, in combination with capital.
Since 1996, Reiten & Co. has invested in 20 companies industries including oil and offshore services, the food industry, telecom, property and various service industries. Eight of the twenty portfolio companies have been divested via stock market listing or sale. In 2010, the portfolio companies had a turnover of approximately NOK 5,8 billion and they have a total of 3400 employees.
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