Should BlackBerry’s $4.7 billion sale to Fairfax Financial not be finalized, BlackBerry would consider breaking up the company. Such a move might actually be better for shareholders, according to people who spoke to Bloomberg.
BlackBerry advisers reportedly approached SAP AG, Cisco, and Samsung about a possible sale, but those companies wanted only parts of the BlackBerry business rather than acquiring the entire company. That has sparked talk of splitting the company into factions so that the value of BlackBerry would increase. Rather than force a company to pay to acquire all of BlackBerry, a bidding process for patents or enterprise might raise more money for BlackBerry’s most valuable units.
After four years of declining market share and poor sales, the value of BlackBerry’s handset division is only a fraction of what it once was. Selling its enterprise operations or patent portfolio would generate the most money of a divided BlackBerry sale.
BlackBerry has already reached an agreement with Fairfax Financial to sell its entire company for $4.7 billion, or about $9 per share. The deal allows BlackBerry to seek other bids, but it will have to pay a penalty if it backs out of the deal, so any rival bid would have to produce enough money to warrant calling off the Fairfax deal. Bloomberg reports that investors are concerned that the deal may not be finalized because BlackBerry currently trades close to the $9 per share Fairfax has offered to purchase the company.