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Amazon Eyeing Stake In Rackspace

By  |  August 17, 2020

Shares of Rackspace Technology Inc. (Nasdaq: RXT) were up almost 12 percent as of 11:56 a.m. EST Monday (Aug. 17) following a Reuters report indicating that Amazon (Nasdaq: AMAZ) may buy a stake in the company.

Rackspace sells customers access to its own cloud and also offers a service called RackConnect, which helps customers access clouds maintained by Amazon Web Services (AWS), Microsoft Azure, VMWare and Google Cloud.

Reuters reported that Amazon is considering buying a minority stake in Rackspace, but there is “no certainty” that a deal would be reached. Rackspace’s majority owner is Apollo Global Management Inc.

Rackspace and Apollo declined to comment, and Amazon did not respond to a request for comment.

In an SEC filing connected with its initial public offering (IPO) earlier this month, Rackspace listed net income of $102 million and revenue of $2.4 billion for the fiscal year that ended Dec. 31, 2019.

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