Managed cloud provider Rackspace is close to being acquired by private equity firm Apollo Global Management, and a deal could be reached as early as this week, according to Reuters. The potential price for the buyout is $3.5 billion, unidentified sources told Reuters.

The Wall Street Journal first reported late Thursday that Rackspace was in advanced talks with a private equity firm. Reuters then identified that firm as Apollo Global and said that the deal could be finalized as early as this week. However, sources also cautioned that the deal could fall apart.

Rackspace shares soared today on the news of a potential buyout. Shares were up 11.34 percent midday.

As of the end of March, Apollo Global managed about $173 billion in assets, $38 billion of which is private equity. The firm has traditionally invested in companies in the industrial, media and retail space but has been migrating into the technology area. Last year, the company acquired IT consulting firm Presidio.

In May 2014, Rackspace hired Morgan Stanley to explore “strategic alternatives” but nothing came of that partnership until now. At the time, Rackspace was facing increased competition from Amazon Web Services (AWS), Google, and Microsoft because those firms were able to offer cloud services for lower prices.

Rackspace has since retooled its business to become a partner to AWS and Microsoft, making it easier for corporate customers to set up private OpenStack clouds.

Earlier this year, Rackspace also announced that it could help streamline the process with pre-engineered cabinets that can be deployed at a customer’s preferred location — whether that’s a Rackspace data center, a third-party data center, or a customer’s data center.