Is BlackBerry Ltd. (NASDAQ:BBRY) Trying To Withstand The Storm?
Reuters’ exclusive report on Friday revealed that BlackBerry Ltd. (NASDAQ:BBRY) board rejected proposals from several technology companies those were eyeing various assets of the company. The Board’s rejection came on the grounds that a break-up would not serve the best interest of all the stakeholders including shareholders. These revelations came in from the sources who did not want to be identified.
This decision can also be viewed in light of Supreme Court of Canada’s landmark ruling in the BCE Inc. (NYSE:BCE) case in 2008 where it mentioned that while deciding on a deal, a Canadian company must consider the interests of all stakeholders including employees, customers, suppliers and the wider community and not just the shareholders. The case was related to the privatization of BCE Inc. and Bell Canada which could have been Canada’s largest corporate takeover. However the deal was subsequently terminated as the private equity investors led by the Ontario Teachers’ Pension Plan Board could not obtain professional accounting opinion on the solvency for the proposed transaction.
Earlier there were rumors that Apple backed an effort to take over BlackBerry’s intellectual property and patents besides other tech giants including Microsoft Corp. and Chinese computer maker Lenovo Group Ltd. also playing their cards to bid for Blackberry’s assets. However, Lenovo was already out of queue when BlackBerry announced earlier last week, to have abandoned plans to go private following high-level discussions with Canadian government.
Now BlackBerry’s decision to put a halt on the company’s break-up has crashed the hopes of other tech giants as well, eyeing particular assets of BlackBerry rather than the 100% buy-out deal.
However a spokeswoman at BlackBerry refused to comment on the Board’s deliberations. Moreover it is also not known what specific proposals were rejected by BlackBerry’s Board during the three month long review period. On the other side, tech companies including Apple and Microsoft also declined to comment anything on the matter.