Rackspace Hosting’s stock closed up nearly 7 percent on Monday after Bloomberg News reported the company was talking to CenturyLink, a Louisiana-based Internet and telecommunications company, about a possible buyout.
Rackspace’s stock, traded under the symbol RAX on the New York Stock Exchange, closed at $39.79 on Monday.
Citing sources familiar with the talks, Bloomberg reported that CenturyLink wants to acquire Rackspace to expand its cloud computing business.
“CenturyLink has discussed the idea with San Antonio-based Rackspace, which last month said it is still conducting an internal review of its strategic options, according to the people, who asked not to be identified talking about private information,” according to the Bloomberg story. “One person said a deal may not be reached for the company, which had a stock-market valuation of $5.33 billion at the end of last week.”