Deutsche Telecom Mulls to Acquire Host Europe Group HEG

This acquisition is being considered by the Deutsche Telecom with the support of US based equity firms to consolidate its cloud portfolio.

Duestche  A breaking story has surfaced in different technology news magazines and online portals this week that, the Deutsche Telecom, a big telecom operator in the Europe region is considering acquiring a well known web hosting company named as Host Europe Group (HEG).

It was further informed that Deutsche Telecom is aggressively pursuing its ambitions to spread the cloud based service portfolio not only in the European region, but also in the North American areas, especially in the United States.

To realize its plans, the company is in consultation with numerous equity firms based in the United States. Some sources have quoted Blackstone equity firm as well as Hellman & Friedman private limited to have been involved in the assessment process to help Deutsche Telecom to acquire HEG. Though, there was no person from those firms to comment or confirm about these reports. But, the informed sources believe that something serious is going on about the same.

It is very important to note that the company has already acquired the Strato Web Hosting Company for $310 million in the year 2009. This platform is being expanded with the acquisition of the HEG group with the help of American equity firms. The Strato platform is a minor player in the European market at the present, but it is being planned to grow huge with the acquisition and merger of the company that is four times bigger than itself in terms of its financial turnover.

According to the sources, the owner of the HEG group, Cinven is interested in starting the sale of process of the company within a couple of months. The estimated value of the company is being estimated at about $1.9 billion or 1.7 billion euros.

Two important things should be noted that Hellman & Friedman has worked with the German telecom company in the recent months to control the majority shares of the Scout24 firm. Both companies are in very close business relationship with each other in the present global conditions.

Similarly, the Blackstone company the major shareholder of the Deutsche Telecom itself and working very closely with the company to expand its businesses across the Europe and other parts of the globe too.

If this merger materializes soon, the web hosting marketplace in the European as well as in the North American region will notice another strong competitor.