Industry News Desk
Chi-Chi Cloud Computing IPO Fails and Drops 20%
Rackspace Hosting, the rare high-tech IPO these days fails to hold up its end end after it debuted Friday in a Dutch auction
By: Maureen O'Gara
Aug. 15, 2008 07:30 PM
Rackspace Hosting, the rare high-tech IPO these days and a chi-chi cloud purveyor at that, failed to hold up its end after it debuted Friday in a Dutch auction and dropped 20% to $10.01 from its offering price of $12.50, the low end of its $12-$16 range. Fifteen million shares were sold – all but 2.3 million coming from the company – and raising a total of about $187.5 million. It wants to expand outside the US. It started pushing toward $11 Monday. Rackspace, which is backed by Sequoia and Norwest Venture Partners, was going to go public in 2000 then thought the better of it.
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