NEW YORK/SAN FRANCISCO: BlackBerry, on the block as its smartphone business struggles, is in talks with Cisco Systems, Google and SAP concerning commerce all or elements of itself, many sources near the matter said.
Such a deal would be an alternate to the preliminary agreement reached weeks past with a bunch, crystal rectifier by BlackBerry’s biggest stockholder, Fairfax monetary Holdings, to require the corporate non-public for concerning $4.7 billion, a bid that has baby-faced some skepticism as a result of funding queries.
The company, based mostly in Waterloo, Ontario, has asked for preliminary expressions of interest from potential strategic consumers, that conjointly embody Intel and Asian firms LG and Samsung, by early next week.
It is unclear that parties can bid, if any. however the potential technology consumers are particularly curious about BlackBerry’s secure server network and patent portfolio, though doubts concerning the assets’ price stay a difficulty, the sources said.
Google, Intel, Cisco, LG and SAP declined to comment. Samsung wasn’t in real time accessible for comment.
Possible bidders area unit continuing with caution given the uncertainty around BlackBerry, that last month rumored a quarterly loss of nearly $1 billion once taking a writedown on unsold Z10 phones.
The value of BlackBerry’s patent portfolio and licensing agreements is probably going to fraction within the next eighteen months, a corporation filing from on shows, probably limiting its attractiveness.
According to analysts, BlackBerry’s assets embody a shrinking however well-regarded services business that powers its security-focused electronic messaging system, value $3 billion to $4.5 billion; a group of patents that might be value $2 billion to $3 billion; and $3.1 billion in money and investments.
Adding to the company’s woes, it’s seemingly to burn through nearly $2 billion of its money pile within the next year and a 0.5, Bernstein analyst Pierre Ferragu wrote on Thursday once learning the filing.
Private equity corporations that have showed interest in BlackBerry – that conjointly embody mythical monster Capital Management – have asked the corporate and its advisers to supply extra monetary details concerning its numerous business segments, 2 of the sources aforesaid. That method might take another few weeks, as BlackBerry focuses on taking bids from trade peers, the sources aforesaid.
In August, the corporate aforesaid it had been advisement its choices, that might embody associate outright sale, once Reuters initial rumored BlackBerry’s board was warming up to the likelihood of going non-public.
At that point, it shaped a five-member special committee chaired by board director Timothy Dattels. different members embody chairman Barbara Stymiest, chief government Thorsten Heins, Richard kill and Bert Nordberg.
A representative for BlackBerry aforesaid in associate emailed statement to Reuters: “The special committee, with the help of BlackBerry’s freelance monetary and legal advisors, is conducting a strong and thorough review of strategic alternatives.” He declined to supply any comment.
JPMorgan Chase & Co and blood cell Capital Markets area unit advising BlackBerry. The board is being suggested by Perella Steven Weinberg Partners, the sources aforesaid. Skadden, Arps, Slate, Meagher & Flom LLP and Torys LLP area unit providing legal recommendation.