Verisign to Acquire Network Solutions in $21 Billion Deal

Strategic Insights -

Verisign Inc. has agreed to buy domain-name registrar Network Solutions Inc. in an all-stock deal valued at $21 billion. The acquisition marks a significant shift in the domain name registration landscape, with Verisign set to become a dominant player in the industry. Network Solutions, which had previously held the federal government contract to exclusively register domain names ending in .com, .org, and .net, will become a subsidiary of Verisign.

Key Takeaways:

  • Verisign will issue 2.15 shares of its common stock for each share of Network Solutions stock as constituted prior to the 2-for-1 split, completing on March 10, 2000.
  • The transaction is valued at approximately $21 billion based on Monday's closing price of VeriSign common stock.
  • The acquisition is subject to approval by VeriSign and Network Solutions stockholders.
  • Network Solutions will become a subsidiary of VeriSign, with Jim Rutt continuing to serve as CEO, reporting to VeriSign President and CEO Stratton Sclavos.
  • The new company expects to add to its existing employee base to exploit new market opportunities.
  • The acquisition is expected to close in the third quarter of 2000, subject to customary conditions, including obtaining necessary regulatory approvals.
  • Network Solutions will maintain its shared registry system that keeps the list of domain names under a particular domain, under an agreement with the US Department of Commerce, until 2004.

Statistics:

  • The transaction is valued at approximately $21 billion based on Monday's closing price of VeriSign common stock.
  • Network Solutions will receive 2.15 shares of VeriSign common stock for each share of Network Solutions stock as constituted prior to the 2-for-1 split.
  • The acquisition is expected to close in the third quarter of 2000.
  • Network Solutions maintains a shared registry system until 2004 as per its agreement with the US Department of Commerce.

Sources:

  • Washtech, 2000 MAR 7 (NB)
  • Wires Online, Business, Legal, NSI, Photo (20000307)