​Rackspace takes rejigged cloud strategy private in $US4.3 billion deal

Tech giant takes cloud plans out of spotlight.

Taylor Rhodes - President and CEO, Rackspace

Taylor Rhodes - President and CEO, Rackspace

Rackspace has agreed to be taken private by Apollo Global Management in a deal valued at $US4.3 billion, as the tech giant takes its cloud act off the public stage.

Following two years of discussions with potential buyers, the cloud service provider has entered into a definitive agreement with the New York-based private equity firm, which boasts over $US186 billion in assets.

After scrapping plans to compete head-on with the market’s leading cloud vendors in Amazon and Microsoft, Rackspace now specialises selling services on the AWS and Azure platforms, adopting a “if you can’t beat them, join them” type mentality.

As reported by Goldman Sachs this week, the move has resulted in Rackspace increasing public cloud revenue by 11 percent year-on-year during the second quarter, on the coat-tails of strong AWS and Microsoft growth.

“We are presented with a significant opportunity today as mainstream companies move their computing out of corporate data centres and into multi-cloud models,” Rackspace president and CEO, Taylor Rhodes, said.

Rhodes said the transaction will provide Rackspace with more flexibility to manage the business for long-term growth, while enhancing the company’s product offerings in the process.

“We are confident that as a private company, Rackspace will be best positioned to capitalise on our early leadership of the fast-growing managed cloud services industry,” Rackspace co-founder and chairman, Graham Weston, added.

Westcon said the transaction is the result of “many months” of due diligence, with the transaction expected to deliver “immediate, significant and certain cash value” to stockholders.

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection

Tags CloudMicrosoftrackspaceAWS

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.
James Henderson
Show Comments


James Cook University - Master of Data Science Online Course

Learn more >


Sansai 6-Outlet Power Board + 4-Port USB Charging Station

Learn more >

Victorinox Werks Professional Executive 17 Laptop Case

Learn more >



Back To Business Guide

Click for more ›

Brand Post

Most Popular Reviews

Latest Articles


PCW Evaluation Team

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Walid Mikhael

Brother QL-820NWB Professional Label Printer

It’s easy to set up, it’s compact and quiet when printing and to top if off, the print quality is excellent. This is hands down the best printer I’ve used for printing labels.

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?