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Rackspace Hires Morgan Stanley to Evaluate Options

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Re: Rackspace Hires Morgan Stanley to Evaluate Options

#41

Post by akurilin »

alaskamiller wrote: post #23
nodesocket wrote: post #17

Earlier quoted context omitted.

Really nobody left, RAX is too big and requires another public company, mainly a blue blood to acquire them. IBM got Softlayer. Google, Amazon, and Microsoft obviously have their own clouds. RedHat has its own PaaS OpenShift. Awkward spot really. Perhaps Facebook wants to join the cloud hosting business, but I doubt it, since they've just coughed up insane amounts of cash with Oculus and whatsapp. Smart play though,…

Facebook has Parse, maybe if that demo matures to having RAX needs then it's worthwhile.

Parse was on AWS, at least before the acquisition, if I recall correctly.

Re: Rackspace Hires Morgan Stanley to Evaluate Options

#42

Post by olegp »

smacktoward wrote: post #10

Aaargh. I love Rackspace. I was looking forward to being a happy Rackspace customer until I was old and gray. And all the things I love about them would be the first things to go after an acquisition. Aaaaaaaaaargh.

Yeah, I hope Geekdom isn't affected. Best startup co-working space in SF IMO.

Re: Rackspace Hires Morgan Stanley to Evaluate Options

#43

Post by dredmorbius »

nodesocket wrote: post #17
us0r wrote: post #7

You generally don't see announcements like this. Are they having a hard time selling that's why it is out there? You would think some of these companies you read saying things like "we missed the cloud" would jump at this.

Really nobody left, RAX is too big and requires another public company, mainly a blue blood to acquire them. IBM got Softlayer. Google, Amazon, and Microsoft obviously have their own clouds. RedHat has its own PaaS OpenShift. Awkward spot really. Perhaps Facebook wants to join the cloud hosting business, but I doubt it, since they've just coughed up insane amounts of cash with Oculus and whatsapp. Smart play though,…

Does Oracle still have whatever fragments remain of Sun's cloud service that nobody ever used?

Re: Rackspace Hires Morgan Stanley to Evaluate Options

#45

Post by hect0r »

nodesocket wrote: post #17
us0r wrote: post #7

You generally don't see announcements like this. Are they having a hard time selling that's why it is out there? You would think some of these companies you read saying things like "we missed the cloud" would jump at this.

Really nobody left, RAX is too big and requires another public company, mainly a blue blood to acquire them. IBM got Softlayer. Google, Amazon, and Microsoft obviously have their own clouds. RedHat has its own PaaS OpenShift. Awkward spot really. Perhaps Facebook wants to join the cloud hosting business, but I doubt it, since they've just coughed up insane amounts of cash with Oculus and whatsapp. Smart play though,…

I would put my money on Cisco. They have been trying to reinvent themselves as a cloud company and clearly their financials show declining margins on hardware as the market shifts to cloud. Their intercloud announcement is interesting but not real yet and I think a Rackspace acquisition would give them a serious boost just as the SoftLayer acquisition by IBM has really accellerated IBM's move into cloud services.

The other possible buyer could be EMC -- for similar reasons -- but I would definitely think Cisco would be more likely.

Re: Rackspace Hires Morgan Stanley to Evaluate Options

#46

Post by us0r »

nodesocket wrote: post #17
us0r wrote: post #7

You generally don't see announcements like this. Are they having a hard time selling that's why it is out there? You would think some of these companies you read saying things like "we missed the cloud" would jump at this.

Really nobody left, RAX is too big and requires another public company, mainly a blue blood to acquire them. IBM got Softlayer. Google, Amazon, and Microsoft obviously have their own clouds. RedHat has its own PaaS OpenShift. Awkward spot really. Perhaps Facebook wants to join the cloud hosting business, but I doubt it, since they've just coughed up insane amounts of cash with Oculus and whatsapp. Smart play though,…

Another possible option could be one of the big consulting firms - Accenture, Deloitte, CGI, etc.

Re: Rackspace Hires Morgan Stanley to Evaluate Options

#47

Post by badamson »

us0r wrote: post #7

You generally don't see announcements like this. Are they having a hard time selling that's why it is out there? You would think some of these companies you read saying things like "we missed the cloud" would jump at this.

It actually happens a lot. 8-K says they've been approached by multiple parties: http://www.sec.gov/Archives/edgar/data/1107694/0001107694140...

Re: Rackspace Hires Morgan Stanley to Evaluate Options

#48

Post by badamson »

rurounijones wrote: post #26

Since stock price seems to be independent of actual company performance these days... Is Rackspace actually in financial trouble? Or is it a case of shareholders moaning that their returns aren't good enough?

They're fine financially. >$300M Cash, $70M of debt (most of which are capital leases). They say they've been approached by "multiple parties" so it's just a matter of trying to get the best offer. http://www.sec.gov/Archives/edgar/data/1107694/0001107694140...

Re: Rackspace Hires Morgan Stanley to Evaluate Options

#49

Post by rurounijones »

badamson wrote: post #48
rurounijones wrote: post #26

Since stock price seems to be independent of actual company performance these days... Is Rackspace actually in financial trouble? Or is it a case of shareholders moaning that their returns aren't good enough?

They're fine financially. >$300M Cash, $70M of debt (most of which are capital leases). They say they've been approached by "multiple parties" so it's just a matter of trying to get the best offer. http://www.sec.gov/Archives/edgar/data/1107694/0001107694140...

Ok, so assume I am an idiot on this (not far wrong). Why is their stock price not high? Just because they are not satisfying shareholders / wall street analysts?

Are the slowly losing customers or see somethign in the future that will cause trouble?

Re: Rackspace Hires Morgan Stanley to Evaluate Options

#50

Post by avelis »

olegp wrote: post #42
smacktoward wrote: post #10

Aaargh. I love Rackspace. I was looking forward to being a happy Rackspace customer until I was old and gray. And all the things I love about them would be the first things to go after an acquisition. Aaaaaaaaaargh.

Yeah, I hope Geekdom isn't affected. Best startup co-working space in SF IMO.

As a Geekdom member. I agree.
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