Cloud company Rackspace may choose to go private

Grazed from CNBC. Author: Editorial Staff.

Cloud computing company Rackspace could take itself private, as a source told TechCrunch the company has been negotiating with a private equity firm to fund the transition. Rackspace could make the announcement this week, TechCrunch reported. Rackspace, which is currently public, would not confirm to TechCrunch whether it was considering going private.

The company, which competes with Amazon.com, Microsoft and Google in a crowded cloud computing sphere, announced in May that it had hired bankers in an effort to partner with or be acquired by another company. At least three companies, including HP and IBM, have offered to buy Rackspace, TechCrunch said, citing a source within the company. Rackspace currently has a market value of $4.8 billion, and an acquisition could value it at upwards of $6.1 billion, TechCrunch wrote. Rackspace shares rose in pre-market trading Wednesday.