A lawsuit was filed for investors in shares of Rackspace Hosting, Inc. (NYSE:RAX) in connection with the proposed takeover was announced and NYSE:RAX stockholders should contact the Shareholders Foundation.
San Diego, CA -- (SBWIRE) -- 10/20/2016 -- The Shareholders Foundation announced that an investor who currently holds shares of Rackspace Hosting, Inc. (NYSE:RAX), filed a lawsuit in effort to halt the proposed takeover of Rackspace Hosting, Inc. by funds managed by affiliates of Apollo Global Management, LLC for $32.00 per share.
Investors who purchased shares of Rackspace Hosting, Inc. (NYSE:RAX) and currently hold any of those NYSE:RAX shares have certain options and should contact the Shareholders Foundation at mail@shareholdersfoundation.com or call 858-779-1554.
The plaintiff alleges that the defendants breached their fiduciary duties owed to NYSE:RAX stockholders by agreeing to sell Rackspace Hosting, Inc. too cheaply via an unfair process to affiliates of Apollo Global Management, LLC.
On August 26, 2016, Rackspace Hosting, Inc. (NYSE:RAX) announced that it has entered into an agreement with affiliates of certain funds (the "Apollo Funds") managed by affiliates of Apollo Global Management, LLC (together with its consolidated subsidiaries, "Apollo") (NYSE: APO)to be acquired for$32.00 per share in cash.
However, plaintiff claims that the proposed consideration NYSE:RAX shareholders will receive is grossly inadequate and undervalues Rackspace Hosting, Inc. Indeed, at least one analyst has set the high target price for NYSE:RAX shares at $44.00 per share. Furthermore, Rackspace Hosting, Inc. reported that its annual Total Revenue rose from over $15.3 billion in 013 to over $2 billion in 2015 and that its respective Net Income increased from $86.74 million to $126.20 million. Shares of Rackspace Hosting, Inc. (NYSE:RAX) reached as high as $53.75 per share in May 2015. In addition, the plaintiff alleges that the process is also unfair to NYSE:RAX stockholder
On October 19, 2016, NYSE:RAX shares closed at $31.83 per share
Those who are current investors in Rackspace Hosting, Inc. shares have certain options and should contact the Shareholders Foundation.
Contact:
Shareholders Foundation, Inc.
Michael Daniels
3111 Camino Del Rio North - Suite 423
92108 San Diego
Phone: +1-(858)-779-1554
Fax: +1-(858)-605-5739
mail@shareholdersfoundation.com