Seeking Alpha

BlackBerry keeps soaring; company reportedly wants "Google-like" buyer

  • BlackBerry (BBRY +9%) is now up 27% since Reuters first reported the company is thinking of going private. The company's enterprise value (excludes $3.1B in cash/investments) has grown to $3B.
  • While Prem Watsa reportedly talks to both P-E firms and "industry players" about a deal, the NY Post reports BlackBerry would prefer to be acquired by a "Google-like" buyer rather than a P-E firm. One source speculates Amazon (AMZN - believed to be interested back in 2011, and possibly able to leverage BlackBerry's NOCs to bolster AWS) could be an option.
  • AllThingsD reports Silver Lake "has no interest in working with Watsa or BlackBerry" on a bid.
  • Another upgrade has come in: Scotia Capital has lifted shares to Outperform.
  • More on BlackBerry
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Comments (44)
  • LYogi
    , contributor
    Comments (2255) | Send Message
     
    Fly baby fly.
    13 Aug 2013, 11:24 AM Reply Like
  • KIA Investment Research
    , contributor
    , BBRY PRO Alerts subscriber
    Comments (9283) | Send Message
     
    "company reportedly wants "Google-like" buyer "

     

    And snakes want legs.

     

    Good grief.
    13 Aug 2013, 11:29 AM Reply Like
  • LYogi
    , contributor
    Comments (2255) | Send Message
     
    My money is on $FB

     

    Zuck is a technological wizard and he will see the value in BBRY
    13 Aug 2013, 11:30 AM Reply Like
  • johnnywadiii
    , contributor
    Comments (13) | Send Message
     
    Facebook and BB...I think that would be a good pair.
    13 Aug 2013, 12:11 PM Reply Like
  • lord_ares
    , contributor
    Comments (78) | Send Message
     
    I doubt Facebook will buy Blackberry. The value in Blackberry lies in enterprise segment. Facebook is not an enterprise company.

     

    If any technology company comes forward, it's Amazon. Google, Apple and Microsoft already has a OS. They would be more interested in parts of BBRY not necessarily the whole company.

     

    If you are looking for an out of the left field buy then I'd say SAP/Oracle/IBM maybe the ones. All three companies already have a very strong enterprise business and BBRY enterprise business will be a great addition to their product portfolios, although, I doubt they SAP/Oracle/IBM will be interested in selling phones.

     

    The other potential is buy is Samsung. Since Google brought Motorola, it makes sense for Samsung to put their eggs in another basket. Tizen is good but so far we haven't heard more than "we are producing a Tizen phone" and the BBRY OS is actually pretty good.

     

    If I were management, I'd take the company private and licence the OS to Samsung/HTC co for free (like Google) and then start making money from services to both consumers and enterprises. But that's just me. :-)
    13 Aug 2013, 12:14 PM Reply Like
  • KIA Investment Research
    , contributor
    , BBRY PRO Alerts subscriber
    Comments (9283) | Send Message
     
    "Facebook and BB...I think that would be a good pair."

     

    Right, because we all know how the DoD wants to be issuing Facebook Phones to all of it's personal for top secret communication.
    13 Aug 2013, 05:35 PM Reply Like
  • slcUTAH
    , contributor
    Comments (535) | Send Message
     
    With BBRY recently being certified by the DOD Apple should seriously think about Blackberry for this reason alone. They have so much money sitting in the bank that they can buy this dog and it won't make a dent in their savings account. BBRY's most valuable asset is SECURITY. Apple can strengthen their enterprise/security business with this and at the same time completely annihilate Samsung's hopes and dreams of being a player in these areas. Apple can sell off what they don't want to the Chinese. I know it's not as easy as what I write but its basically an idea sketched on a napkin if you know what I mean.

     

    With Icahn's announcement of investing big bucks with Apple would it be farfetched to think Icahn doing Apple a favor by shorting the heck out of BBRY to get the price knocked down to below $6 so Apple can fly in like a vulture and buy BBRY cheaper???? Icahn will WIN and WIN.

     

    -Cheers!
    13 Aug 2013, 06:08 PM Reply Like
  • Randal James
    , contributor
    Comments (2797) | Send Message
     
    Mr. K.

     

    You miss the significance and power of social networking. Think Paul Revere.

     

    "Whoa, I was talking a walk and saw these boats. Are they for real?"

     

    "Those are british flags they have and the one in front is a Colonel."

     

    "Like Colonel Sanders?"

     

    "OMG. I love those new boneless ribs."
    13 Aug 2013, 06:50 PM Reply Like
  • KIA Investment Research
    , contributor
    , BBRY PRO Alerts subscriber
    Comments (9283) | Send Message
     
    slcUtah,

     

    I believe Apple could throw 200 of the worlds smartest security experts into a dedicated wing of 1 Infinite Loop Cupertino, CA and outdo whatever BlackBerry has done in with security and avoid the headache of integration, assimilation, management, culture, and whatever else would come with a BlackBerry purchase.
    13 Aug 2013, 08:43 PM Reply Like
  • KIA Investment Research
    , contributor
    , BBRY PRO Alerts subscriber
    Comments (9283) | Send Message
     
    hah, randal good one.

     

    You've seen this right?

     

    CIA's 'Facebook' Program Dramatically Cut Agency's Cost http://onion.com/JZ8Kgz
    13 Aug 2013, 08:46 PM Reply Like
  • Michael Bryant
    , contributor
    Comments (5615) | Send Message
     
    If anybody buys (BBRY), it will be Canadian. Canadian government probably won't let (AAPL) or (FB) buy (BBRY) unless the companies can prove that it won't hurt Canadian employees. Bet Bell Canada may buy (BBRY).
    13 Aug 2013, 11:07 PM Reply Like
  • KIA Investment Research
    , contributor
    , BBRY PRO Alerts subscriber
    Comments (9283) | Send Message
     
    " Canadian government probably won't let (AAPL) or (FB) buy (BBRY) unless the companies can prove that it won't hurt Canadian employees."

     

    Michael, you're joking right?
    This would be like a dream come true!

     

    This is like the hottest cheerleader in high school asking the unpopular, pimple-faced geek to the senior prom.

     

    Thanks for the chuckle though.
    14 Aug 2013, 12:00 PM Reply Like
  • Robert Castleman
    , contributor
    Comments (281) | Send Message
     
    Amazon? My first impression is that would be a great partnership. Amazon has no fear of investing for the future. They could really take the solid technology of BBRY and do something with it.

     

    Corporate cultures? That's always a roll of the dice. Could BBRY be absorbed by Amazon without dissolving it into nothingness?

     

    Very interesting ....
    13 Aug 2013, 11:39 AM Reply Like
  • Randal James
    , contributor
    Comments (2797) | Send Message
     
    And Amazon understands about not making a profit...
    13 Aug 2013, 11:57 AM Reply Like
  • Michael Bryant
    , contributor
    Comments (5615) | Send Message
     
    It's all about cash flow. Buffett stresses watching cash flow.
    13 Aug 2013, 11:09 PM Reply Like
  • gwynfryn
    , contributor
    Comments (4335) | Send Message
     
    Nice one Ran! Thanks for the chuckle.
    14 Aug 2013, 05:36 AM Reply Like
  • Jballa
    , contributor
    Comments (374) | Send Message
     
    Buffett stresses cash flow into his mega-conglomerate!
    14 Aug 2013, 07:11 AM Reply Like
  • DDSLT5
    , contributor
    Comments (8) | Send Message
     
    Seriously - I'm hoping that this is just the start! Short squeeze finally here?
    13 Aug 2013, 11:39 AM Reply Like
  • alext1379
    , contributor
    Comments (706) | Send Message
     
    Facebook could make BlackBerry more acceptable mainstream.

     

    Amazon can leverage its other assets to the point they can give BlackBerrys away and make money on licenses and value-added services.

     

    Amazon/FB would probably offer a higher LBO price than a PE firm.

     

    I personally would prefer IBM because they can best cement BB leadership place in the corporate and non-fart app world. Also, IBM needs something to get the negative press off their backs.

     

    All speculation until someone hands over an offer sheet.
    13 Aug 2013, 11:42 AM Reply Like
  • slcUTAH
    , contributor
    Comments (535) | Send Message
     
    IBM's back WILL break by more negative press by acquiring Blackberry.

     

    -Cheers!
    13 Aug 2013, 06:15 PM Reply Like
  • DeepValueLover
    , contributor
    Comments (8661) | Send Message
     
    Another Watsa/Ross Deep Value Investment announcement coming soon?
    13 Aug 2013, 11:44 AM Reply Like
  • gwynfryn
    , contributor
    Comments (4335) | Send Message
     
    In profit? Then take it.
    13 Aug 2013, 11:45 AM Reply Like
  • hahaha48
    , contributor
    Comments (1105) | Send Message
     
    There was an article on BBRY from a long term investor who sold all the stocks before the last earning report. He listed his reasons why he is leaving the boat from a company he loved. He did said the only up side is for the company to be sold at no more than $20.
    I learn a lesson from BBRY. Better long options to gamble in stocks that you have no strong reasons to hold for the long term no matter how attractive it looks for a short term bet.
    I just start writing calls on my BBRY positions this morning and hope to get out of my positions in the next few months. My 3 losing positions are BBRY(20% lost), INTC (5% lost) and FXI (5% lost)
    13 Aug 2013, 12:02 PM Reply Like
  • Jballa
    , contributor
    Comments (374) | Send Message
     
    Hahaha48,

     

    I feel you, brother. It is a dicey stock to invest in with no hedging! I've never bought or sold an option...but it does seem that options are the way to go with this unstable rocket ship!
    14 Aug 2013, 01:32 PM Reply Like
  • Chris Lau
    , contributor
    Comments (1925) | Send Message
     
    Watsa/Silver fight to the death (wall street style, so angry letters to each other). Amazon-FB as white knight, complete dominance in mobile, with (FB) social ads and Amazon great seller of online content.
    13 Aug 2013, 12:06 PM Reply Like
  • Randal James
    , contributor
    Comments (2797) | Send Message
     
    Oh great! Now the damsel in distress is reviewing the resumes of who might show up to untie her from the railroad track.

     

    My group would include CACI, HP or Rockwell Collins, all of whom do more than a billion in sales to the US military in various communications related fields.

     

    Do we think GOOG wants to be selling these to the Saudi Military?

     

    Just because a company has cash does not make them an ideal suitor. Next up we'll be hearing about Marha Stewart because she could get the colors right and Cracker Jax because they could help move the unsold inventory.
    13 Aug 2013, 12:17 PM Reply Like
  • Infinity Group
    , contributor
    Comments (578) | Send Message
     
    I feel strongly that this is short covering! follow the volume and at this rate by Thursday there increase should level off.
    13 Aug 2013, 12:20 PM Reply Like
  • mitrado
    , contributor
    Comments (2003) | Send Message
     
    Shares go higher as soon as they throw the towel. That makes sense! :-P
    13 Aug 2013, 12:38 PM Reply Like
  • cmcfarling
    , contributor
    Comments (79) | Send Message
     
    If Blackberry can't sell Blackberries, what makes anyone think Amazon, Facebook or anyone else can?
    13 Aug 2013, 12:45 PM Reply Like
  • Nick Shadow
    , contributor
    Comments (193) | Send Message
     
    My 2 cents in the "for what it is worth dept" is HP.

     

    They want to increase and expand their relationship with major customers, BES.

     

    Rumors are they want to be in the handset business: BB phones

     

    Network and device security and management: BB present and future offerings.

     

    Additional uses for QNX in the equipment business.

     

    In dependent OS.

     

    They have the market clout to make BB10 a good concern.

     

    But I don't think a complete take over, my guess is a partnership.

     

    Another one that rattles around is Sony.

     

    Now the real outlander, Honeywell. They have been buying handheld industrial device companies (bar code scanners and terminals) for the last few years. They just bought Intermec. They are BB customers, they do a LOT with the Gov't. They have mentioned they are on the hunt.

     

    Nick
    13 Aug 2013, 12:49 PM Reply Like
  • Inzaghi009
    , contributor
    Comments (26) | Send Message
     
    Darn, the value just went back to zero gain for the day. What happened? I'm long.
    13 Aug 2013, 03:57 PM Reply Like
  • KIA Investment Research
    , contributor
    , BBRY PRO Alerts subscriber
    Comments (9283) | Send Message
     
    My guess would be that people were using today's highs as an opportunity to exit their positions gracefully.
    13 Aug 2013, 05:40 PM Reply Like
  • slcUTAH
    , contributor
    Comments (535) | Send Message
     
    Hi Inzaghi009:

     

    Yeah, the stock lost almost all of its big gains today and briefly went red only to get back into the green right before the session concluded. I think the Icahn announcement of investing in Apple knocked the wind out of BBRY's sails. I think a lot of people actually thought that Icahn was somehow/ someway going to invest in BBRY. They saw a Dell/BBRY connection and dumped their stocks and took their profits immediately after the announcement even though the stock was losing steam before the Icahn surprise.

     

    Also, there are more analysts coming out saying that BBRY's valuation is only $7 per share (yikes!) Another negative factor IMO is that BBRY has been up for sell since 2012. The consensus is that no one wants to buy the company because there's nothing useable. This stock is so toxic. I expect the stock to plunge tomorrow and Thursday. The new floor is $8.50. The beat goes on. Anyone who is thinking about starting a position should take extreme caution.

     

    -Cheers!
    13 Aug 2013, 05:52 PM Reply Like
  • alext1379
    , contributor
    Comments (706) | Send Message
     
    Consensus? There is no concensus. Between real analysts and rental analysts, the share value rnges from negative $5 to $11.50 and up.
    Anyone who just released a note saying BlackBerry is worth $7 is a rent by the word analyst trying to save their client's short position and preventing a squeeze.

     

    BlackBerry didn't even come close to $7 even after the overreaction to 3 months of bb10 sales.
    13 Aug 2013, 11:39 PM Reply Like
  • iemlegend
    , contributor
    Comments (4) | Send Message
     
    All valid points but missing the important ones.

     

    Yes FB could provided more mainstream exposure but just as we saw with the FB phone, no one cares.

     

    HP is not strong enough to make BB matter again.

     

    As for the comment about no one able to help blackberry, think Ford. They turned around by FIXING WHAT MADE THEM FAIL. They changed build quality, style and price.

     

    Amazon makes the best sense for multiple reasons. 1). Has very deep pockets [this plays multiple parts as well]. 2) has excellent advertising 3) already has their own app dev group [ and this is BB's biggest hurdle and biggest reason why anyone outside business people won't buy blackberry]. Amazon fixes the faults that hurt BB while BB continues to build the quality product we all know and live.

     

    .JMO
    13 Aug 2013, 06:40 PM Reply Like
  • Randal James
    , contributor
    Comments (2797) | Send Message
     
    iemlegend

     

    HPQ is not without an interest in the government defense business that might be key to BBRY's future:

     

    http://bit.ly/14IUftp

     

    Amazon, on the other hand will sell almost anything but just because it is on Amazon it doesn't mean it will sell better. In fact, many of us like to see an hold a phone in our hand before purchasing. With the announcement that BBRY is essentially putting itself up for sale, few consumers will be eager to take a risk that they will be there next year. That means the carriers will likely drop the brand so the remaining outlets will be very limited.

     

    Bad juju all around.
    13 Aug 2013, 07:03 PM Reply Like
  • LYogi
    , contributor
    Comments (2255) | Send Message
     
    too quick to say that.

     

    in a few weeks or less we will know BBRY's partner/owner and that will once again change the playing field.
    13 Aug 2013, 08:51 PM Reply Like
  • iemlegend
    , contributor
    Comments (4) | Send Message
     
    @Randal: Amazon buying BB does not necessarily mean we wouldn't be able to hold the phone before purchase. Look at the Kindle (fire, hd, paperwhite, etc). Holding an interest in gov. Products is ok but not enough to save a dying brand.

     

    We all know BB makes quality, it's quantity that hurts the bottom line. The masses have no interest due to the pack of personalization, app content and feature content. Amazon helps with the first two due to their vast array of personalization options for all things electronic and their own app dev teams. The feature content can be helped by deep pockets for R&D. It also helps that amazon has many resources and bonds with other tech companies.

     

    10 years ago, I could agree with HP. Now, that's equal to choosing Chrysler over Toyota.
    13 Aug 2013, 09:15 PM Reply Like
  • Z10isgreat
    , contributor
    Comments (274) | Send Message
     
    I think BB's exact comments were looking at all options including strategic partnerships. Not sure a sale is the only hand they're willing to entertain but it is certainly the one that the media jumped on in a feeding frenzy.
    13 Aug 2013, 11:08 PM Reply Like
  • ovenboy
    , contributor
    Comments (85) | Send Message
     
    I found this interesting:

     

    http://bit.ly/14wkKyc
    14 Aug 2013, 12:25 AM Reply Like
  • ATInsider
    , contributor
    Comments (422) | Send Message
     
    Strategic Partnership with an electronics company that starts with P and ends with a C. A company that deals with Plasma HDTV's and Blu-Ray Players just to name a few. ;)
    14 Aug 2013, 01:15 AM Reply Like
  • gwynfryn
    , contributor
    Comments (4335) | Send Message
     
    Ah yes, the first ever (I believe) positive BBRY review on eWeek! Must have some significance, but I'm blowed if I can figure out why...
    14 Aug 2013, 05:42 AM Reply Like
  • jakoba
    , contributor
    Comments (345) | Send Message
     
    Wondering why no-one is mentioning Oracle as a possible bidder for Blackberry. Oracle has over $30B in cash and is one of those companies largely controlled by a owner who would like new intriguing risks, that has the luxury of thinking long term, and also has successfully incorporate dozens of big companies into Oracle in the past.

     

    Larrison´s relationship to ORCL is similar to Bezos´relationship to AMZN. Mr Larrison owns 25-30% of Oracle´s shares.

     

    Oracle has made numerous giant acquisitions in the past, including Oracle for $7.4B (2009), Bea Systems for $8.5B (2008), Siebel Systems for $5.9B (2006) and Peoplesoft for $10.3B (2005). In fact over the past 10 years they have made acquisitions worth a total of as much as $50B, to my knowledge far in excess of any other tech company. This year they acquired Acme Packet for $2.1B.

     

    Mr Ellison was also interested in buying Apple back in the 1990´s.
    14 Aug 2013, 06:26 AM Reply Like
  • Randal James
    , contributor
    Comments (2797) | Send Message
     
    jakoba

     

    One of the distinguishing characteristics of the acquired companies you mentioned is that they were all software companies, as is Oracle. Trying to sell a strange add-in such as communications security is a hardware issue, which was never in Oracle's catalogue. That is not even considering retaining the hardware business itself, which is going to be dumpster material in the wrong hands.

     

    HPQ, for all of its struggles, does sell hardware, does do military and *might* find it interesting. Not at a price that would make everyone around the table break into cheers. They might be an eventual recipient of a hardware carve-out.
    15 Aug 2013, 08:48 AM Reply Like
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