Rackspace just racked up its biggest acquisition ever

Rackspace just racked up its biggest acquisition ever

Acquisition of Datapipe set to bring “important new capabilities” to the managed cloud provider

Rackspace has struck a deal to acquire managed hosting services and data centre provider, Datapipe, in a bid to expand its global reach and multi-cloud capabilities.

While the value of the deal remains undisclosed, Rackspace claims it is the largest in its history, and it brings “important new capabilities” to the managed cloud provider.

Headquartered in the United States, Datapipe is known for its provision of managed services across public and private clouds, managed hosting and colocation services. It has data centres in several regions globally including Hong Kong and Singapore.

Rackspace claims that the move to acquire Datapipe was made following customer demand for the company to expand its abilities in managing, at scale, multiple clouds. With the acquisition of Datapipe, Rackspace anticipates that it will be able to meet the growing demand.

“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 looking for,” Rackspace CEO, Joe Eazor, said.

“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,” he said.

Among the new capabilities that Datapipe is expected to deliver to Rackspace are data centres and offices in key markets where Rackspace today has little or no presence today, including the West Coast of the US, Brazil, mainland China, and Russia.

The acquisition is also expected to give Rackspace traditional colocation services across four continents, to “reduce cost and risk for customers moving applications out of their corporate data centres”, according to Rackspace.

The deal will also hand Rackspace a greater palette of professional services, software and tooling that is expected to help better serve enterprise customers, while also giving the company the ability to offer managed services on the Alibaba Cloud.

Apart from the funds needed to buy Datapipe, Rackspace also expects to bring something to the table, including providing new capabilities for Datapipe customers, such as deep experience in Microsoft and VMware private clouds.

Pending regulatory approvals, Rackspace’s acquisition of Datapipe is expected to close in the fourth quarter. Rackspace said it will develop a comprehensive integration plan and will take “great care to maintain and enhance the exceptional customer outcomes that both companies are known for”.

The Rackspace executive leadership team will stay in place and, indeed, may expand, following the deal.

“Rackspace looks forward to welcoming the talented employees who will be joining us from Datapipe,” the company said in a statement.

At the same time, the majority owner of Datapipe, Abry Partners, will become an equity investor in Rackspace. 

It was revealed in August last year that Rackspace had agreed to be taken private by Apollo Global Management in a deal valued at US$4.3 billion, with the tech giant taking its cloud act off the public stage.

In early February this year, the company's then CEO, Taylor Rhodes, revealed via blog post that the company would cut about six per cent of its workforce in areas that have seen slowed growth in recent years.

In May,  Rackspace announced that the company’s board of directors had appointed former EMC and HP executive, Joe Eazor, as the company's new CEO, effective 12 June.

As CEO, Eazor is responsible for the company’s global strategy and operations, spanning the US and the three other continents where Rackspace maintains offices and data centers, including Australia.

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Tags data centresManaged ServicesacquisitionrackspacecolocationDatapipe



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