Bluehost, the affordable, reliable hosting company famously preferred by bloggers (read the Bluehost reviews here), will soon be part of the same company that owns Constant Contact.
$1.1 billion dollar acquisition deal puts BlueHost and Constant Contact in the same business family.

Announced this week on November 2, 2015, BlueHost’s parent company Endurance International Group (EIG) will pay $1.1 billion for Constant Contact.

The actual deal is set to take place sometime during the first three months of the new year.

How this affects Constant Contact’s share price.

The price for Constant Contact’s stock for the deal will be $32 per share. That deal price is significantly higher than the actual going price per share of Constant Contact.

As it stands as of October 30, 2015, the price per share was $26.10. That was the last day of trading before the acquisition deal was announced. As of this writing, November 4, Constant Contact (CTCT) was trading at $31.58 per share.

During the past year, CTCT has traded as low as around $24 per share (in October). However, even the acquisition deal price of $32 is nowhere near the year’s high of $42.93 on March 5, 2015.

During the first week of May 2015 CTCT saw a sharp drop-off in price of its shares, plunging from over $39 on April 23 to $27.50 on May 1, 2015.

Whichever way you look at it, however, it’s good news for Constant Contact, BlueHost, and every other partner business which falls under the wings of Endurance International. When CTCT stock made its debut in 2007, the stock price was half of what it will be when this deal goes through.

What is Constant Contact?

Constant Contact is known for its email marketing software, and in recent years has benefited from the rise in popularity of email marketing. They also offer the following services to small businesses:

  1. survey software
  2. personal marketing management
  3. custom startup and design services
  4. social media message tracking
  5. apps for facebook and other interfaces
  6. seminars
  7. auto emails for birthdays, welcomes, etc (called “auto-responders”)

Details of the billion dollar deal.

Both EIG and Constant Contact are headquartered near Boston, whereas BlueHost HQ is in Provo, Utah. BlueHost is also characterized by its leading affiliate program- word of mouth marketing in particular since their services are very attractive to independent business owners. It’s very affordable, it integrates beautifully with WordPress, and the level of customer service has to date been far and beyond its competitors.

It’s interesting to note that some of BlueHost’s main competitors are also owned by EIG. They include:

  • A Small Orange
  • HostGator
  • BigRock

The deal is expected to generate year-over-year growth of 10% to 12% in the coming year for EIG, which means BlueHost and all its “competitors” aren’t going anywhere anytime soon.

EIG is a strong company that seems to be making sound decisions on buying solid internet business companies aimed at the small business owner. CEO of Endurance International Group was quoted as saying “Our team has always been passionate about helping small businesses do more business”.

This is pretty darn amazing when you think that they already own all those other hosting companies…and now? Email marketing? That’s pretty amazing.

Monopoly much?

I just hope they continue to push out good products.