Moody’s reviews Rackspace

Moody's Investors Service said it placed Rackspace Hosting, Inc. ratings under review for downgrade, including the Ba1 corporate family rating, Ba1-PD probability of default rating and Ba1 senior unsecured rating.

The review was prompted by the announcement of Apollo Global Management's planned $4.3 billion, all cash acquisition of the company.

In order to finance the buyout, the agency expects leverage will rise, putting downward pressure on Rackspace's credit profile.

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