Correction: The month of the company's IPO has been fixed.
Rackspace Hosting, flush with cash post IPO, announced Thursday it has acquired two companies as part of a retooled cloud hosting strategy.
Rackspace, a hosting services provider based in San Antonio, Texas, snapped up Xen-based virtual machine hosting company Slicehost and cloud storage company Jungle Disk. Terms of the deals were not disclosed.
"Cloud computing offers tremendous benefits to our customers that complement our traditional managed hosting services," Lanham Napier, Rackspace Hosting CEO, said in a statement.
With the acquisitions and deeper dive into cloud computing, Rackspace plans to integrate their technology into its hosting portfolio over time. Jungle Disk's technology allows customers to share an unlimited volume of cloud storage between multiple users through a secure, mountable network drive and automatic backup. Slicehost's technology provides on-demand, virtualized servers.
While Rackspace's success in cloud computing has yet to be seen, it is one of the rare companies that has managed to go public in the second half of the year as the economy has started tanking. The company raised $187.5 million and priced its IPO at $12.50 a share.
Since its August debut on the New York Stock Exchange, its shares have fallen to $5.
Wall Street gave a nod to cloud computing as San Antonio, Texas-based Rackspace Hosting on Friday opened for trading on the New York Stock Exchange following its initial public offering Thursday.
(Credit:
BusinessWire)
However, its shares fell 20 percent in their first day of trading, which came as a disappointment for the first venture-backed company to go public in nearly five months, according to a MarketWatch report. Rackspace has received backing from Sequoia Capital and Norwest Venture Partners, according to MarketWatch.
The hosting company, which boasts 30,000 customers, is trading under the ticker symbol "RAX." It raised $187.5 million in an offering underwritten by Goldman Sachs, Credit Suisse, and Merrill Lynch. Shares were priced at $12.50 late Thursday, but fell to $10.01 by the closing bell Friday.
Rackspace's cloud computing division, Mosso, recently added a new Web-based control panel and a behind-the-scenes provisioning system to its Hosting Cloud service. The control panel makes it easier for users to set up and manage hosted applications, and includes a new Web-based file manager that gives users access to stored data so that they can create and decompress archives and change access permissions more easily.
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