BlackBerry thrown in the towel, puts company up for sale



Author Pradeep // in News

Blackberry formerly known as RIM today announced that they are looking for strategic alternatives to escape from the clutches of death. They stated that the strategic alternatives includes sale of the company, some joint ventures, partnerships, etc,. Making such an open announcement publicly shows that Blackberry really does not have any of the above in discussions right now.

This reminds me of Palm few years back. Even though Blackberry has few billions dollars more than Palm in the balance sheet and a huge declining install base, they are pretty much in the same point. Just like Palm, some technology company like Dell who have no or little experience in mobile could buy them and shut them off their operations in few years. According to their current CEO, they are going to focus on BB10 and BES1 10 platform to see some success. BB10 and BES10 faces an uphill battle against three big ecosystems Windows, iOS and Android backed by three largest tech companies Microsoft, Apple and Google. I highly doubt they will be able to emerge as a winner again.

With Blackberry going away, Windows Phone has become the only other viable alternative other than iOS and Android. Carriers may soon start supporting Windows Phone more than ever to stop market being dominated by Android and iOS.

What do you think?

BlackBerry Board of Directors Announces Exploration of Strategic Alternatives

Monday, August 12, 2013
BlackBerry Board of Directors Announces Exploration of Strategic Alternatives
07:57 EDT Monday, August 12, 2013

WATERLOO, ONTARIO–(Marketwired – Aug. 12, 2013) – BlackBerry Limited (NASDAQ:BBRY)(TSX:BB), a world leader in the mobile communications market, today announced that the Company’s Board of Directors has formed a Special Committee to explore strategic alternatives to enhance value and increase scale in order to accelerate BlackBerry 10 deployment. These alternatives could include, among others, possible joint ventures, strategic partnerships or alliances, a sale of the Company or other possible transactions.

The Special Committee of the Board is comprised of Barbara Stymiest, Thorsten Heins, Richard Lynch and Bert Nordberg, and will be chaired by Timothy Dattels.

With the announcement of the Special Committee, Prem Watsa, Chairman and CEO of Fairfax Financial informed the Company that he felt it was appropriate to resign due to potential conflicts that may arise during the process. Fairfax Financial is the largest BlackBerry shareholder. Mr. Watsa said, “I continue to be a strong supporter of the Company, the Board and Management as they move forward during this process, and Fairfax Financial has no current intention of selling its shares.”

“During the past year, management and the Board have been focused on launching the BlackBerry 10 platform and BES 10, establishing a strong financial position, and evaluating the best approach to delivering long-term value for customers and shareholders,” said Timothy Dattels, Chairman of BlackBerry’s Special Committee of the Board. “Given the importance and strength of our technology, and the evolving industry and competitive landscape, we believe that now is the right time to explore strategic alternatives.”

Thorsten Heins, President and Chief Executive Officer of BlackBerry, added, “We continue to see compelling long-term opportunities for BlackBerry 10, we have exceptional technology that customers are embracing, we have a strong balance sheet and we are pleased with the progress that has been made in our transition. As the Special Committee focuses on exploring alternatives, we will be continuing with our strategy of reducing cost, driving efficiency and accelerating the deployment of BES 10, as well as driving adoption of BlackBerry 10 smartphones, launching the multi-platform BBM social messaging service, and pursuing mobile computing opportunities by leveraging the secure and reliable BlackBerry Global Data Network.”

JP Morgan Securities LLC is serving as financial advisor to BlackBerry and Skadden, Arps, Slate, Meagher & Flom LLP and Torys LLP are serving as legal advisors.

There can be no assurance that this exploration process will result in any transaction. The Company does not currently intend to disclose further developments with respect to this process, unless and until its Board of Directors approves a specific transaction or otherwise concludes the review of strategic alternatives.

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