Cloudways, a web hosting enterprise based in St Julian’s, Malta and Karachi, Pakistan, has secured an all-cash buyout deal with American cloud services giant DigitalOcean worth $350 million (€350 million, thanks to parity between the euro and the dollar).
The acquisition was announced by the New York-headquartered company on Tuesday, and is expected to close in September.
A “significant portion” of the $350 million will be paid over the subsequent 30 months.
DigitalOcean is aiming to attract more small and medium-sized enterprises (SMEs) through the deal.
The two firms have worked together since 2014, and around half of Cloudways’s clients already use DigitalOcean’s services.
Cloudways Co-Founder and CEO Aaqib Gadit said: “We have always felt like a part of the DigitalOcean team so we are incredibly excited to officially become a part of the company.”
Adding Cloudways to DigitalOcean’s portfolio of capabilities is expected to provide SMEs with easier workflows and on-ramps to build their websites and applications.
“DigitalOcean has always been focused on helping get ideas on the internet quickly, grow them, and scale them — with Cloudways we will be able to make that process even easier and for a wider range of SMB,” read the statement.
Cloudways is expected to remain a standalone business unit with Mr Gadit at the helm.
DigitalOcean went public in March 2021, but its share price currently stands below its initial price. It is hoping that the acquisition of Cloudways, which is growing rapidly and generates free cash flow, will contribute close to $15 million to its revenues this fiscal year, according to Bloomberg.
Cloudways was founded in 2012 with backing from Secways SL, a Barcelona-based angel investor. It forms part of Pakistan's Gaditek, itself part of the Disrupt.com ecosystem. Disrupt.com says it has "founded and funded many tech businesses and products that went ahead and achieved big, runaway successes".
According to its website, it currently has 280 employees from over 20 countries, and has been featured on industry publications like The Motley Fool, Tom’s Guide, and CNET.
