Ancestry.com sells for $1.6B to private-equity firm

European private-equity firm Permira is buying genealogy website Ancestry.com for $1.6 billion, according to the Wall Street Journal.

Citing anonymous sources, the Journal said that the new buyers want to expand the company’s subscriber base in western Europe and make technological improvements to the site. The larger goal is to make family history into more than a niche market by adding deeper archives and data for a wider international audience.

The buyout is a bet that family-history research is more than a niche market and that the subscriber base can swell with technological innovations, deeper archives and a wider international audience. People familiar with the buyers’ plans said that expansion in western Europe is a goal.

Publicly traded Ancestry.com has more than two million subscribers who pay at least $12.95 a month for its content and online tools. The purchase price is $32 a share and it includes vesting of outstanding options. The price is a 40 percent premium from the price when word of the company being offered for sale surfaced in June.

As a result of the deal, Provo, Utah-based Ancestry.com will carry  “just under $1 billion” in debt. The company was founded in 1983 and it shifted its focus online 15 years ago. It has digitized billions of historical records.

The buyout group includes the private-equity firm’s co-investors; members of Ancestry.com’s management, including Chief Executive Tim Sullivan and Chief Financial Officer Howard Hochhauser; and Spectrum Equity, which owns about 30 percent of Ancestry.com.