June 3, 2014 (Shareholders Foundation) - An investigation on behalf of investors in Rackspace Hosting, Inc. (NYSE:RAX) shares was announced concerning whether a potential takeover of Rackspace Hosting would be unfair to investors in NYSE:RAX shares.

The investigation by a law firm is at an early stage and concerns whether a takeover would be unfair to NYSE:RAX investors.

On May 15, 2014, Rackspace Hosting, Inc. disclosed in a filing with the SEC that in recent months, Rackspace has been approached by multiple parties who have expressed interest in exploring a strategic relationship with Rackspace, ranging from partnership to acquisition. Rackspace Hosting said that its board decided to hire Morgan Stanley to evaluate the inbound strategic proposals and to explore other alternatives which could advance Rackspaces long-term strategy. On May 16, 2014, an article stated that potential suitors for a takeover of Rackspace Hostings could be companies such as AT&T, IBM, EMC, HP, and VMware.

Shares of Rackspace Hosting, Inc. (NYSE:RAX) jumped from a close of $28.64 per share on May 14, 2014, to as high as $37.37 per share on May 16, 2014.

However, given that at least one analyst has set the high target price for NYSE:RAX shares at $67.00 per share. the investigation a law firm concerns whether the Rackspace Hosting Board of Directors will undertake an adequate sales process, adequately shop the company before entering into any transaction, maximize shareholder value by negotiating the best price, and act in the shareholders' best interests in connection with the proposed sale.
Rackspace Hosting, Inc. (NYSE:RAX) reported that its annual Total Revenue rose from $780.55 million in 2010 to over $1.53 billion in 2013 and that its respective Net income increased from $46.36 million to $86.74 million.

Shares of Rackspace Hosting, Inc. (NYSE:RAX) traded as high as $78.93 per share in early 2013.