Cloud applications are built from a set of components often deployed as containers, which can be deployed individually on separate Virtual Machines (VMs) or grouped on a smaller set of VMs. Additionally, the application owner may have inhibition constraints regarding the co-location of components. Finding the best way to deploy an application means finding the best groups of components and the best VMs, and it is not trivial because of the complexity coming from the number of possible options. The problem can be mapped onto may known combinatorial problems as binpacking and knapsack formulations. However, these approaches often assume homogeneus resources and fail to incorporate the inhibition constraints. The main contribution of this paper are firstly a novel formulation of the grouping problem as constrained Coalition Structure Generation (CSG) problem, including the specification of the value function which fulfills the criteria of a Characteristic Function Game (CFG). The CSG problem aims to determine stable and disjoint groups of players collaborating to optimize the joint outcome of the game, and a CFG is a common representation of a CSG, where each group is assigned a value and where the value of the game is the sum of the groups’ contributions. Secondly, the Integer-Partition (IP) CSG algorithm has been modified and extended to handle constraints. The proposed approach is evaluated with the extended IP algorithm, and a novel exhaustive search algorithm establishing the optimum grouping for comparison. The evaluation shows that our approach with the modified algorithm evaluates on average significantly less combinations than the CSG state-of-the-art algorithm. The proposed approach is promising for optimized constrained Cloud application management as the modified IP algorithm can optimally solve constrained grouping problems of attainable sizes.