Rackspace Hosting, the managed hosting and cloud computing company based in San Antonio, is reportedly close to closing a $3.5 billion deal with Apollo Global, a private equity firm, to take Rackspace private, according to reports in the Wall Street Journal, Fortune and numerous other publications.
In 2014, Rackspace announced it had retained Morgan Stanley and Wilson Sonsini Goodrich & Rosati to examine ways to maximize shareholder value including a possible sale of the company. But later that year, Rackspace announced it was no longer for sale and instead appointed Taylor Rhodes as its new CEO.
But now things seemed to have changed. The Wall Street Journal reported on Thursday that Rackspace’s sale was near and that it was in talks with one or more private equity firms. On Friday, Fortune reported the company’s stock was halted in trading on the Nasdaq amind the buyout rumors.
Rackspace, founded in San Antonio in 1998, has about 5,000 employees worldwide. It is one of San Antonio’s largest technology companies and it also has a major office in Austin. The company is based in the old Windsor Park Mall in Windcrest, which was refurbished into its headquarters.
Rackspace’s stock, listed as RAX on the Nasdaq exchange, closed at $29.27 on Friday, up 10 percent from the previous day. The company is scheduled to release its earnings on Monday and perhaps then the company will provide more insight into a possible sale.
Correction: The headline on this story incorrectly the reported sale amount. It is $3.5 billion.