real-time news and commentary for investors
Wednesday, Aug 21
BlackBerry lower; Bloomberg, analysts speculate breakup on tap
- BlackBerry (BBRY -2.6%) is giving up some more of its recent gains after Bloomberg and contacted analysts suggest the company's phone business is "essentially worthless," and that BlackBerry's other assets (patents, BES, the network operations centers, cash/investments) are only worth ~$5B (current market cap is $5.3B).
- Fund manager Brian Huen: "Nobody is interested in buying the entire entity. I think they are now in the phase of saying, ‘We will do anything to maximize value, including breaking up the company.'"
- Canaccord: "The most logical acquirer of BlackBerry would likely attempt to transition BlackBerry’s subscriber base to its own competing smartphone products" BMO thinks it would cost a buyer $800M to shut down BlackBerry's phone unit.
- However, much of the buyout speculation thus far hasn't involved a rival OEM, but Prem Watsa and his reported efforts to talk to both P-E firms and "industry players" about a bid.
- Pac Crest recently suggested BlackBerry's purchase commitments will limit the size of any bid.