Rackspace Sees IPO of 15m Shares

• By theWHIR.com , July 25, 2008

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By Justin Lee, theWHIR.com

July 25, 2008 -- (WEB HOST INDUSTRY REVIEW) -- Rackspace Hosting (rackspace.com) announced on Friday it has registered its initial public offering of 15 million shares at an estimated price of $12 to $16 per share, according to a report on Reuters (reuters.com).

In April, Rackspace filed its S-1 form with the US Securities and Exchange Commission, seeking to raise up to $400 million through an IPO of its common stock. According to the filing,  Goldman, Sachs, Credit Suisse and Merrill Lynch were lead underwriters for the IPO.

The company has previously filed papers in preparation for an IPO in March 2000, but withdrew its plans following the dot-com crash.

In March, the company made a couple of major announcements that foreshadowed the long-awaited IPO filing, including the unveiling of its new corporate identity and strategy emphasizing its utility computing business model and the hiring of a new CFO.

Rackspace reported revenue of $96.2 million in the third quarter of 2007 - its 35th consecutive quarter of revenue growth.

In an amended filing with the US Securities and Exchange Commission, the web hosting provider said it plans to sell 12.7 million shares while stockholders will sell an additional 2.3 million shares.

The company has also applied for New York Stock Exchange listing under the symbol "RAX." 

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