CNBC's Faber citing sources, tweets: company is to announce it has ended review of strategic alternatives. Will remain independent
- Follow up: Rackspace confirms ends Formal Evaluation of M&A Transactions; Focus Remains on Managed Cloud Market Leadership- ended its evaluation of alternatives that would result in Rackspace being acquired. The company declared its commitment to remain independent and announced Taylor Rhodes as CEO to lead and drive its managed cloud strategy.
- Rackspace had been approached by multiple parties who expressed interest in exploring a strategic relationship, ranging from partnership to acquisition. The board retained Morgan Stanley and Wilson Sonsini Goodrich & Rosati to facilitate a comprehensive review to maximize value for shareholders, customers, and employees. After a comprehensive review, the board decided to terminate M&A discussions. Based on Rackspace's reaccelerated revenue growth and its potential trajectory for the coming year, the board concluded the company is best positioned to maximize shareholder value by executing its strategy as the #1 managed cloud company.
- Exec: The board also considered a share repurchase program and determined that, based on the company's significant opportunities, it is prudent to maintain flexibility at this time to ensure that the appropriate investments can be made to drive our strategy forward. We will continue to evaluate the benefits of implementing a buyback program in the future,
--> rumor was that Century Link has lined up financing for a bid; also suggests HPQ could be interested in RAX
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