Blackberry Offer Acquisition Hurdle and Opportunities


The acquisition of Nokia device business by Microsoft increased speculation around Blackberry acquisition by Microsoft or its competitor. The patent rich Blackberry still offer command deep penetration among prosumer’s due to its integrated security whereas BYOD device running on multiple OS still struggling to garner Enterprise segment confidence. With current market capitalization of less than $5.4 Bn and register 75 plus Million user for its services makes Blackberry very attractive acquisition candidate. The launch of new operating system and premium device from BB received mixed reception from customers and at the same time lost crucial mobile OS market share YoY.

Even Blackberry management came out openly and admitted that they are exploring all options to make sure that iconic solution offer donot die away. Many fund players who invested in Blackberry in its glory time are contemplating to join hand with private equity firm to take the company private and subsequently realign the business as per the industry direction. Based on the messaging register user base, patent valuation, cash in hand indicate that the fair value of Blackberry is somewhere $12-13 Bn. With current share price, value investors are buying with expectation of acquisition by either funds or competitor to reap in high returns. The major roadblock indicate Canadian government as they are not comfortable giving Blackberry to third party due to the security reason.

The reservation of Canadian government is keeping many potential bidders at bay. Based on the last financial quarter, it is evident that Blackberry is few quarter away to make its business profitable and start recapturing market share with slew of device launch and adoption of its BES and BIS by Enterprise Customers. Even during worst phase faced by Blackberry during transition to new operating system, it was observed that the registered user base de-growth was not in double digit. It would be interesting to see how Canadian government and regulators tackles Blackberry acquisition issue in case of acquisition bid comes down the line

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