Blackberry has just announced (via Business Insider) that an investment firm has put in an offer for the company. At $9 a share, the deal is worth about 4.7 billion dollars in total. Fairfax already owns about 10 percent of Blackberry before the deal.
Having an investment company buy Blackberry does not have a direct impact on the smartphone market. Often though, investment firms buy out companies with the aim of selling off assets separately. For instance, BlackBerry’s patent portfolio may soon be put up for auction as a result of the deal, allowing for smartphone makers like Apple and Google to then bid for the intellectual property without the other baggage associated with buying out the failing company in its entirety.
Indications that Fairfax had intentions to execute a buyout surfaced recently, when the CEO resigned from the board due to conflicts of interest with Blackberry’s “strategic alternatives” decision making process. This suggested Fairfax Capital had at least shown interest in conducting a buyout.
This is likely the end of a relatively quick decline for the smartphone pioneer which was on top of the market as recently as 2008 but failed to innovate against the tide of much better iOS and Android devices.
BlackBerry isn’t sold yet. Agreement is has “a number of conditions” incl. 6 weeks of due diligence. $BBRY can also look for higher bids.
— Sarah Frier (@sarahfrier) September 23, 2013
