The managed cloud company Rackspace on Monday announced it's acquiring managed hosting company and data center operator Datapipe. This is the second major acquisition made by Rackspace since it was purchased by Apollo Global Management for $4.3 billion and made private in November. In June the company completed its acquisition of TriCore Solutions, which offers managed cloud and consulting services.
According to Rackspace's PR manager, Brandon Brunson, the deal announced this week is the largest in the company's history and will broaden both the company's capabilities and the services it will be able offer. "Customers have been asking Rackspace to rapidly expand its abilities in managing multiple clouds at scale," he wrote in a blog post, "and with the acquisition of Datapipe, Rackspace will be able to meet this growing demand."
Indeed, Datapipe brings a lot to the table. The company operates 29 data centers in nine countries, including the US (West Coast), Brazil, China, and Russia -- all markets where Rackspace has little or no presence. Linked to the China operations are managed services on Alibaba Cloud, the largest public cloud on mainland China.
The company also has experience dealing with high-profile public sector customers, including the US departments of Defense, Energy, and Treasury, as well as the UK Cabinet Office, Ministry of Justice, and Department of Transport.
But "managing multiple clouds at scale" seems to be the sweet spot that Rackspace is after.
"Our customers are looking for help as they spread their applications across public and private clouds, managed hosting, and colocation, depending on the blend of performance, agility, control, security, and cost-efficiency they’re seeking," Joe Eazor, Rackspace's CEO, said in a statement. "With the acquisition of Datapipe, we're very pleased to expand the multi-cloud managed services we provide our customers, while also opening doors to new opportunities across the globe."
According to Brunson, Rackspace sees the deal as a win-win situation, pointing out that Datapipe's existing customers will benefit from Rackspace's experience with Microsoft, VMware, and OpenStack private clouds, including Azure Stack and VMware Cloud on AWS; its managed Google Cloud Platform; and its managed application services that include Oracle and SAP ecosystems.
"Customers need guidance using public cloud infrastructure from Alibaba Cloud, Amazon Web Services, Google Cloud Platform, and Microsoft Azure," Robb Allen, founder and CEO of Datapipe, said in a statement. "They also need help navigating the use of private clouds, managed hosting, and colocation solutions, often in combination, as they move critical applications out of their corporate data centers. The combination of complementary capabilities and resources from both of our companies will create the world’s leading provider of multi-cloud managed services."
Brunson said that pending regulatory approvals, the acquisition is expected to close in the fourth quarter of 2017. Like Rackspace, Datapipe is privately held, and acquisition price was not disclosed.
"The majority owner of Datapipe, Abry Partners, will receive equity in Rackspace," Brunson wrote. "No additional terms or details of the transaction will be publicly disclosed."