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Rackspace announced an agreement to acquire Onica on November 4, 2019, to add AWS-focused consulting and cloud-native services to its managed-cloud portfolio. Rackspace later announced the deal’s completion on December 3; its SEC filing gives November 15 as the acquisition date and reports a net purchase price of $315.9 million.
What happened, and when?
The dates describe different stages of the transaction, not a conflict:
- November 4, 2019: Rackspace announced its agreement to acquire Onica. At the time, it did not disclose the terms and expected the deal to close in late fourth quarter 2019. Rackspace’s announcement.
- November 15, 2019: Rackspace’s SEC filing identifies this as the date it acquired 100% of Onica. Rackspace Technology’s SEC filing.
- December 3, 2019: Rackspace publicly announced completion of the acquisition. Completion announcement.
How much did Rackspace pay for Onica?
Rackspace’s SEC filing reports $323.4 million in total consideration, net of $7.5 million in cash acquired, resulting in a net purchase price of $315.9 million. The consideration included a purchase-price adjustment tied to the difference between actual and estimated net working capital. These are the filing’s accounting figures for the 2019 acquisition; they were not disclosed in Rackspace’s initial announcement.
Why did Rackspace buy Onica?
Rackspace said the acquisition would expand its AWS expertise and strengthen its managed-cloud and professional-services portfolio. Onica brought cloud consulting and managed services, which Rackspace described as complementary to its existing services. In its SEC filing, Rackspace summarized the purpose as expanding its managed public-cloud and professional-services offerings and enhancing its AWS partnership. These statements explain Rackspace’s rationale; they do not establish whether the acquisition achieved its intended results.
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Services Rackspace highlighted
Rackspace’s November announcement described Onica’s work in strategic advisory, architecture and engineering, application development, infrastructure and application modernization, serverless development, containers, and the Internet of Things (IoT). Its December completion announcement also named machine learning. These are capabilities Rackspace attributed to Onica at the time of the deal, not a current service catalogue.
Onica’s profile at the time
In its 2019 announcement, Rackspace described Onica as founded in 2014, headquartered in Santa Monica, California, and having more than 350 consultants across North America and nine AWS competencies. Those are announcement-era figures, not current counts or confirmation that Onica remains a separate provider.
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What the acquisition announcement said
Stephen Garden, then Onica’s CEO, said in Rackspace’s November 4, 2019 announcement: “By combining our capabilities with Rackspace’s global presence, resources and scale, we will be better positioned to achieve our mission of helping customers innovate using AWS.” This captures the companies’ stated strategic intent, rather than an independent assessment of the transaction’s results.
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