San Antonio, Texas-based web hosting company Rackspace Inc. filed an Initial Public Offering (IPO) last Friday in a bid to raise $400 million, a number of sources have reported. The company will adopt the Google model of setting its IPO price by auction. The company will trade on the New York Stock Exchange under the symbol “RAX”.
Rackspace has filed IPO applications previously, filing first in 2000 as Rackspace.com to raise $38 million by offering 3.2 million shares at $11-$13 each. The company withdrew its IPO in March 2001 after reporting a loss on 1999 revenues. Underwriters for the move are Goldman Sachs, Merrill Lynch, Credit Suisse, and WR Hambrecht & Co.
Rackspace’s revenues increased 62 percent in 2007 rising to $362 million, with net down 10% on the previous year at $17.8 million. The company has reported cash flows of $105 million last year, up $441 million on 2006.
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