Cisco Named as Possible BlackBerry Suitor
Cisco, Google and Samsung have been identified as "potential strategic buyers" of BlackBerry assets, according to a Reuters report.
The ailing Canadian smartphone and data services specialist, which is losing market share, cutting headcount and suffering crippling operating losses, has already signed a letter of intent to sell itself to a consortium led by Fairfax Financial Holdings in a deal that values its shares at $9 each. (See BlackBerry to Cut 4,500 Jobs and BlackBerry Inks Deal to Go Private.)
But BlackBerry is now scoping out M&A alternatives, according to the report, and has contacted a number of major industry names that could be interested in buying some or all of the company. Those companies include Cisco Systems Inc. (Nasdaq: CSCO), Google (Nasdaq: GOOG), Intel Corp. (Nasdaq: INTC), LG Electronics Inc. (London: LGLD; Korea: 6657.KS) , Samsung Corp. , and SAP AG (NYSE/Frankfurt: SAP).
BlackBerry investors will be keen to see a deal done quickly, as the company is expected to burn through much of its cash during the next two years, while the value of its assets, such as its patents, licensing deals, and global data service infrastructure, is set to diminish in the near-term.
Concerns about the company's financial position and ability to operate a viable business have hit its share price in recent weeks, but renewed speculation about additional M&A interest has given the company's stick a lift in pre-market trading early Monday, with BlackBerry's share price rising more than 5 percent to $8.11, though that is still some way below the Fairfax-led consortium's offer.
— Ray Le Maistre, Editor-in-Chief, Light Reading