BlackBerry, the Canada-based smartphone maker is exploring joint ventures, partnerships or a sale of the company, it announced yesterday.
In a media statement, the company said that it has formed a Special Committee of the Board, comprised of Barbara Stymiest, Thorsten Heins, Richard Lynch and Bert Nordberg, and will be chaired by Timothy Dattels.
It has appointed JP Morgan Securities LLC as its financial advisers while Skadden, Arps, Slate, Meagher & Flom LLP and Torys LLP will serve as legal advisers.
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. 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.”
According to a media report, Canada Pension Plan Investment Board CEO Mark Wiseman said last week he would consider an investment in BlackBerry if the smartphone maker decided to go private.
Speculation about possible foreign bidders have focused on Chinese companies such as Lenovo, Huawei & ZTE, all three which have been expanding its mobile-devices business. However it is very unlikely the Canadian or U.S. governments would allow such a takeover to occur, since there would be huge security questions surrounding a merger with BlackBerry and a Chinese device manufacturer.
The possible deal is subject to the Canadian Government’s approval as any foreign takeovers of companies with asset values of more than $334 million will be reviewed to determine whether the transactions would benefit the country.
Some analysts have suggested that Samsung might be interested in BlackBerry. Samsung, which most of its smartphone runs on the Google Android platform, appears to be trying to distance itself from Google. Since Google acquired Motorola, the creator of the Android platform now compete with its Android licensees, such as Samsung.
“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”, BlackBerry said.
BlackBerry shares rose to $10.78 at the close in New York, marking the biggest one-day gain since March.