Rackspace (RXT) Change in Control Update Re-Ignites Amazon (AMZN) Speculation
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As noted earlier, gains in Rackspace Technology (NASDAQ: RXT) Friday (+6%) are tied to speculation Amazon (NASDAQ: AMZN) could target the company in a buyout. Triggering the speculation was an update in the company's change in control provisions, overnight, related to the CEO and other key executives.
Under the new plan, the CEO will get two times his base salary and a target bonus. Other key executives will receive similar compensation.
Rackspace was acquired in 2016 by private equity giant Apollo Global Management for $4.3 billion. It came back to the public market last August.
Rackspace is a key partner of Amazon's AWS, the Internet giant's largest profit driver. In addition, just weeks after the August 2020 IPO, Reuters reported that Amazon was in early talks to acquire a minority stake in Rackspace. That stake purchase never materialized.
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