Is BlackBerry Looking for a Buyer? Special Committee is Formed

To say that BlackBerry has had its share of problems would be an understatement. BlackBerry has seen its share price fall by nearly 38 percent in the last six months. Right now it is trading at $9.76 on NASDAQ. This is actually slightly higher following reports last week that it might go the route of Dell and go private.

Earlier this morning, trading halted for a few minutes on the Nasdaq stock market until an announcement was made that it is now exploring what it considers strategic alternatives.This includes a possible sale or some sort of partnership deal. A committee that is being chaired by Timothy Dattels and will include CEO Thorsten Heins, Barbara Stymiest, Richard Lynch and Bert Nordberg, has been formed to look for alternatives.

In January I attended the BlackBerry “re-launch” were it announced that it was completely overhauling the company as well as completely redesigning from the ground up. The question has always been: was this a case of too little too late?


image via mobile.pro

On June 28, 2013 BlackBerry announced it Q1 fiscal 2014 earnings results. As expected the quarter was a disappointment. The company reported a loss. At that time its shares were hovering around $10.80, compared to today’s $9.76, and that was down from $14.48.

In a statement Timothy Dattels said, “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.”

Dattles went on to say, “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.”

One effect that going private will have on BlackBerry is that the company will not be out there for public scrutiny. Compared to previous versions the BlackBerry 10 platform is a complete change which, in turn involves a lot of changes to the company. Is it too late to make a positive difference?

We have seen that BlackBerry lost some major corporate and government accounts this year. What kind of toll has this taken on the company? Has this also taken its toll on developers and the rest of the ecosystem? A smartphone is only as good as the apps that run on it.

Going private may also have some pitfalls. A turn away from the public markets may be more about majority shareholders then being able to more easily sell off assets. Another glaring business issue is that the company is still selling more of its legacy BlackBerries than it is its newer handsets.

While BlackBerry Enterprise Service 10 (BES 10) seems to have made some major headway, the smartphones have not taken off quite as strong as BlackBerry had hoped for. BlackBerry is also developing cross platform applications. Once again is this a scenario of too little, too late?

In a statement from CEO Heins, he said, “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.”

In a formal statement issued by the company, “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.”

Ah, there is nothing like that cliff-hanger, serial mentality. We won’t show you everything, you’ll just have to continue going to the movies and hope that chapter 2 will appear on the screen.