​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!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags CloudMicrosoftrackspaceAWS

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

Brand Post

PC World Evaluation Team Review - MSI GT75 TITAN

"I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it."

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

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.

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?