Rackspace IPO Priced at $12.50

Rackspace Hosting, Inc. (RAX) announced late Thursday that its initial public offering of 15 million shares will be priced at $12.50 per share, near the low end of the expected range of $12 to $16. Rackspace will offer 12.7 million shares in the offering and the selling stockholders will offer an additional 2.3 million. An additional 2.25 million shares have been allocated for overallotment sales, raising the potential IPO to 17.25 million shares.

The $12.50 pricing means the offering could raise up to $215.6 million if the overallotment is exercised, and $187.5 million without the overallotment shares.

Rackspace, a managed hosting and IT infrastructure specialist based in San Antonio, said on April 25 that it would go public through a “dutch auction” process similar to that used by Google in its 2004 IPO. The company, which has raised $39.6 million, filed to go public in March 2000 but withdrew its plans a year later after the collapse of the dot-com bubble.

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About the Author

Rich Miller is the founder and editor at large of Data Center Knowledge, and has been reporting on the data center sector since 2000. He has tracked the growing impact of high-density computing on the power and cooling of data centers, and the resulting push for improved energy efficiency in these facilities.