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Rackspace IPO Rumor: $10 Billion Valuation for Managed Cloud Services Provider?

Rackspace Hosting may pursue an IPO (initial public offering) later this year, according to Bloomberg. The report suggests the managed cloud services provider (CSP) could have a $10 billion valuation.

Apollo Global Management acquired Rackspace for $4.3 billion and took the company private in 2016. At the time, the hosting provider was pivoting from traditional public cloud services toward managed cloud services for third-party platforms like Amazon Web Services (AWS), Microsoft Azure and Google Cloud Platform.

The strategy, essentially: If you can’t beat the cloud giants head-on, assist customers with workload management, monitoring and security across those preferred clouds.

As part of the evolution, Rackspace had layoffs and a CEO change in early 2017, and acquired Datapipe for multi-cloud management capabilities later that year for $800 million. Another acquisition, involving TriCore Solutions, pushed the company toward managed services for Oracle and SAP applications.

More recently, Rackspace has introduced managed security services for third-party clouds. Neither Apollo nor Rackspace replied to Bloomberg’s request for comment.

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