FTR buys up remaining stake in WebCentral
Nadia Cameron, ARN
ASX-listed technology group FTR Holdings has purchased the remaining 50.6 per cent stake in Web Internet hosting company WebCentral from its directors for $19.6 million.
As part of the new deal, the three original founders of WebCentral –Lloyd Ernst, Byron Newton and Joe Altoff – will move out of executive roles within the company. The trio will however, continue to provide consulting services over the next two years while also retaining a 10 per cent stake in the FTR group.
WebCentral chief operating officer, Andrew Spicer, has been appointed to the post of CEO in place of current boss, Lloyd Ernst.
FTR’s decision to buy out WebCentral follows its acquisition of a 49.4 per cent stake in the hosting company for $11 million in 2000.
According to FTR, the total value of the WebCentral business has now risen to $38.7 million.
Ernst said the FTR acquisition was part of a four-year plan to bring the company into the public domain.
“In 2000, we started planning, getting the right people onboard, systems, lawyers and so on,” he said. “We’ve been working on this for a while.” Ernst said the three original WebCentral founders would spend the next six months focusing on the WebCentral/FTR transition.
“A lot of private companies you find are in the situation where the founders are the cornerstone of the business,” Ernst said. “But in 2000, we brought in Andrew Spicer, as well as a new legal council. We made sure that the company has a good foundation of staff [without the founders].
“We [the founders] have been doing this for a while – almost seven years. We have ensured the company has expertise in its staff and skills and we’re happy with what we’ve done. It’s time to change some players.”
New WebCentral CEO, Andrew Spicer, said there were no operational changes slated for the WebCentral business.
“The overall strategy of the company will remain unchanged,” he said. “There’s no tack to do something different,”
FTR’s acquisition of WebCentral would give the company the opportunity to become part of a listed entity, thereby gaining more market exposure, Spicer said.
“It also gives us access to capital should we need it,” he said.
Spicer outlined four elements of the company’s market strategies he would focus upon. These include growing the company’s core Web hosting business, as well as continuing to promote its wholesale division.
The company’s corporate services subsidiary, WebCentral Complex, would also play an increasingly important role in the company going forward, he said.
“We plan to ramp up this side of the business. Becoming a listed entity helps boost our credibility in these markets,” he said.
WebCentral Complex, which was launched two years ago, provides application infrastructure and managed services to both corporate and government customers.
Spicer said the company would also look at introducing additional hosting applications such as its Managed Exchange 2003 service, an email tool designed for SMEs.
“We’re hoping to move into more hosting applications for others through the ASP model. We want to be the hosting company of choice,” he said.
The maturity of the broadband market and increasing uptake of the technology within the business community had introduced new opportunities for providing ASP-based services to companies, Spicer said.