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Businesses in the San Antonio area laid off more than 1,000 people so far this year, according to state records.
Click through the slideshow to see which San Antonio-area companies laid off their employees in 2016.
Businesses in the San Antonio area laid off more than 1,000 people so far this year, according to state records.
Click through the slideshow to see which San Antonio-area companies laid off their employees in
Description: Layoff
Date: Sep. 30, 2016
Description: Layoff
Date: Sep. 30, 2016
Rackspace Hosting Inc., which was acquired just three months ago for $4.3 billion by a New York private equity firm, is trimming its workforce, according to two people familiar with layoffs.
News of the cuts first appeared on Reddit this morning, with “techmaster210” reporting that about 500 workers were being laid off. Another person on Reddit said the cuts were closer to 300, with 200 in San Antonio.
One manager at Rackspace confirmed that a round of layoffs started today, decling further comment because the news isn’t public. Another person familiar with the company said about 300 people, mostly middle managers, were issued pink slips.
Rackspace spokesman Brandon Brunson declined to comment.
RELATED: Dissatisfied customer sues Rackspace
The managed cloud company was taken private in November by investment firm Apollo Global Management.
Apollo is known as a seasoned corporate turnaround player, breathing new life into faltering companies like Hostess Brands. Apollo bought the Hostess Brands cake business out of bankruptcy in 2013 with financier C. Dean Metropoulos for $410 million. They brought in new management and restarted operations that had gone dormant, putting the iconic Twinkie back on grocery store shelves. Hostess has since gone public, and has a current market value of about $1.85 billion.
It’s common in leveraged buyout transactions for the acquiring company, which often takes on a lot of debt to complete the deal, to restructure operations and reduce expenses.
RELATED: Rackspace's Weston to be nominated to board of Frost Bank's parent
At the time of the transaction, Rackspace had 3,741 employees in San Antonio and 4,876 in the U.S. Its global workforce was more than 6,200 employees.
Go to ExpressNews.com later today or Wednesday’s newspaper for more details on the Rackspace restructuring.
pdanner@express-news.net
Twiter: @AlamoPD
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