Shares of cloud-computing company Rackspace were down as much as 18% in after hours trade on Tuesday after the company said it would remain independent.
The company had been evaluating options for selling itself.
In a press release, the company said:
“[Rackspace] has ended its evaluation of alternatives that would result in Rackspace being acquired. The company declared its commitment to remain independent and announced Taylor Rhodes as CEO to lead and drive its managed cloud strategy. As previously disclosed in a Form 8-K filed with the Securities and Exchange Commission on May 15, Rackspace had been approached by multiple parties who expressed interest in exploring a strategic relationship, ranging from partnership to acquisition… After a comprehensive review, the board decided to terminate M&A discussions. Based on Rackspace’s reaccelerated revenue growth and its potential trajectory for the coming year, the board concluded the company is best positioned to maximise shareholder value by executing its strategy as the #1 managed cloud company.”
Year-to-date, Rackspace shares were flat excluding Tuesday’s after hours move. Through the summer, Rackspace rallied on hopes the company might strike a deal.