Is the tilde part of the problem?

The reason I'm asking this is, because it's not. It would help us tremendously to help you better if you showed the error message you got. That error message might also help you to find the error.

Also, it often helps to describe what you want a particular snippet to do. In your specific case, it seems as if you want to replace all strings "example.com" to be replaced by "12.34.56.78/~example". Note that this will also affect strings like http://www.badexample.com which will become http://bad12.34.56.78/~example if your replacement worked.