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GoDaddy (GDDY) Expands Commerce Services With Poynt Buyout

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GoDaddy Inc. (GDDY - Free Report) recently announced that it has agreed to acquire Poynt, a payments processor firm, for a total amount of $365 million.

Per the deal, GoDaddy will pay $320 million in cash, while the remaining $45 million will be paid in deferred cash payments, subject to meeting performance and employment conditions over a  three-year period.

The transaction is expected to close in first-quarter 2021, subject to the receipt of all regulatory approvals.

Post the deal closure, Osama Bedier, the CEO of Poynt, will join the GoDaddy team and report to Bhutani as the head of a newly created Commerce Division.

The deal will definitely expand GoDaddy’s commerce offerings and provide it an edge over its competitor, Shopify.

About Poynt

Founded in 2013, California-based Poynt is a payments processor firm. It enables businesses to sell and accept payments anywhere through its suite of products. It offers contactless in-store terminals, and online and phone payment acceptance technology.

Currently, Poynt’s technology is used by more than 100,000 merchants.

How Poynt Will Benefit GoDaddy

Following the deal completion, GoDaddy will integrate Poynt's services into its Websites + Marketing and WordPress commerce services.

This integration will enable small businesses to connect commerce experiences across various channels.

This means that GoDaddy’s customers will soon be able to rely on a single platform for using the complete suite of commerce and payment services.

Nowadays, people prefer online purchases of essential supplies, which in turn, are amplifying demand for the digital payments market. The payments industry has been shifting to the electronic mode over the recent years, given the proliferation of technology. The coronavirus episode will only expedite this transition.

Given this fact, offering combined services certainly presents the company with a significant revenue generating opportunity. Therefore, the latest deal will help GoDaddy expand commerce services with integrated payments.

Aman Bhutani, the CEO of GoDaddy said that the deal will accelerate GoDaddy's efforts to "provide a complete suite of commerce and payment services to address this critical customer need and focus on a large addressable market opportunity."

Zacks Rank & Stocks to Consider

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Long-term earnings growth for The Trade Desk, Dropbox, and Inuvo is currently projected at 25%, 40.9% and 30%, respectively.

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