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Webcentral mounts cost-saving consolidation effort

Webcentral mounts cost-saving consolidation effort

Domainz, Melbourne IT, Netregistry and WME could be rolled into a single brand

Joe Demase (5G Networks)

Joe Demase (5G Networks)

Credit: 5G Networks

Webcentral Group has told shareholders it plans to simplify and streamline a number of key areas across its business, including moving to a single, unified brand and developing a standardised set of core products.  

The move, according to the Australian Securities Exchange (ASX)-listed digital services provider, is being made in an effort to drive cost savings and efficiency improvements.  

“The business transformation will include the transition to a single brand, with a standardised set of core products that enhance the digital experience for customers,” the company told shareholders.  

Webcentral currently claims a number of discrete brands, including New Zealand domain name registrar Domainz, as well as Australian online services providers and domain registrars Netregistry and Melbourne IT. Webcentral also claims digital marketing agency WME.

The consolidation could see these brands scrapped and rolled into a single brand name, although the group is yet to provide further detail about the unified brand.

Moreover, the group plans to streamline its service delivery by reducing the number of supplier arrangements it has in place. It hopes this will result in profitable, new revenue growth through improved margins and streamlined delivery of key digital services.  

The company, previously known as Arq Group before selling off its enterprise services business of the same name, has also made a strategic decision to migrate direct customer support services, previously located overseas, back to Australia.  

The new Australian based support team will manage frontline support with second level and infrastructure support to be managed via the local customer support centre of telecommunications carrier 5G Networks, which has been steadily buying up shares of Webcentral Group after making an acquisition bid for the group last year.  

Despite persistent resistance from shareholder Keybridge Capital, including multiple applications made to the Australian Takeovers Panel, 5G Networks’ managing director Joe Demase took over the temporary leadership of Webcentral Group in October last year, as managing director, amid the ongoing efforts to acquire the beleaguered IT services provider.

“The executive team at Webcentral are very proud of the entire group,” Demase told Webcentral shareholders. “Our people have embraced and welcomed these strategic programs with an approach which is professional, positive, and absolutely dedicated to exceeding our customer expectations. We are one team now driving the future success for this business.”

In August last year, Webcentral posted a significant loss for its half yearly results, dropping 1,217 per cent, as it faced a customer dispute and deep debt. In July 2020, US-based technology services company Web.com Group moved to acquire Webcentral for around $12.2 million.

Webcentral subsequently struck an acquisition bid agreement with 5G Networks, terminating its previous acquisition agreement with US domain name registry Web.com.


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