Rackspace Sells Cloud Sites Platform to Liquid Web

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There is some M&A action out of Rackspace today, and it’s not the news that many were expecting after reports last week that Rackspace may go private. Liquid Web announced on Monday that it has signed an agreement to acquire Rackspace Cloud Sites business unit in a deal that could provide a peek into Rackspace’s changing strategy.

The deal will open Liquid Web up to a new area of customers, including designers, developers and digital agencies who use the Platform as a Service (PaaS) to host high traffic websites, and could indicate that Rackspace is planning to shed its more traditional hosting services while doubling down on its support offerings for third-party clouds.

According to Liquid Web, the Cloud Sites unit will remain in San Antonio, and Liquid Web said it is working with Rackspace to ensure a smooth transition for these customers. Liquid Web is also committed to investing in the Cloud Sites platform, Rackspace’s premium hosting service that started at $150 per month.

According to the press release, Cloud Sites augments Liquid Web’s portfolio while adding capabilities to further simplify web hosting and cloud services. With the acquisition, the Liquid Web team will grow to 550 employees and 30,000 customers globally.

“With the addition of Cloud Sites, we further our mission to empower web professionals all over the world to create content and commerce without worry, free of problems and devoid of even one bit of hesitation by providing absolutely flawless web hosting,” Liquid Web CEO Jim Geiger said in a statement. “Unfortunately, our industry is trending toward unsupported services, which leaves fast-growing developers, digital agencies and designers alone, without a real person to turn to when they really need help. However, at Liquid Web, day-in and day-out our people stand behind the creators of content and commerce and we’re going to continue to stand behind those businesses who rely on the web and cloud. Our job is to delight and every single human being in our company is empowered to do so. Each of them has a relentless devotion to simplifying how our customers experience web hosting and cloud services.”

“As Rackspace continues to focus on delivering expertise and Fanatical Support for the world’s leading clouds, and serving more enterprise customers, it made sense for us to sell the Cloud Sites business unit to Liquid Web,” Matt Bradley, vice president, corporate development and strategy, at Rackspace said. “Through the transaction, we are also pleased to welcome Liquid Web to the Rackspace Partner Network as an email reseller.”