GoDaddy Defends Accounting Behind Buyout of Up-C Tax Benefits

The GoDaddy Inc. board’s approval of an $850 million buyout of tax benefits held by its founder and early investors followed standard accounting practices, even though that sum was substantially higher than the liability listed in public filings, the company’s attorney argued Wednesday in a Delaware courtroom.

The $175 million that GoDaddy recorded in a February 2020 financial statement for liability associated with rights to “tax receivable agreements” didn’t reflect the economic valuation of payments to investors for those rights, GoDaddy’s attorney, Jordan Eth of Morrison & Foerster LLP, said in a hearing in Delaware’s Court of Chancery. ...