Cookie policy: This site uses cookies (small files stored on your computer) to simplify and improve your experience of this website. Cookies are small text files stored on the device you are using to access this website. For more information on how we use and manage cookies please take a look at our privacy and cookie policies. Some parts of the site may not work properly if you choose not to accept cookies.

sections

Report: Rackspace about to be sold to a private equity firm

  • Print
  • Share
  • Comment
  • Save

The end of an era

Update: Reuters is reporting that the company in question could be Apollo Global, who it says are negotiating a price of more than $3.5 billion.

After hiring investment bank Morgan Stanley to explore strategic options two years ago, Rackspace Hosting may be nearing a sale to a private equity firm, the Wall Street Journal reports.

People familiar with the matter told the paper that the company is in advanced talks with one or more private equity firms, with a deal possibly being announced as soon as this week.

And you’re done

rackspace servers data centre

Inside a Rackspace data center

With a market value of $3 billion before the report, WSJ speculates a takeover valuation of $4 billion - still far below its valuation a few years ago, when it seemed like a viable competitor to Amazon Web Services.

Rackspace, which now resells AWS cloud, as well as Azure (but not Google due to low demand), has struggled to compete against the high-spending hyperscale cloud providers who have rapidly dominated the market.

While it looks like Rackspace is set to be sold, Amazon’s cloud business has seen a 58 percent revenue gain year-over-year.

Rackspace is expected to report second-quarter results on Monday.

Have your say

Please view our terms and conditions before submitting your comment.

required
required
required
required
  • Print
  • Share
  • Comment
  • Save

Webinars

More link