BlackBerry Announces They're Up For Sale

Jacob Harper |

Ten years ago BlackBerry Ltd. (BBRY) was the king of the burgeoning smartphone market. But after years of falling behind rivals Samsung and Apple Inc. (AAPL) with little hope of recovery, it appears the company is finally throwing in the towel. On Monday, BlackBerry formally put itself up for sale, with CEO Thorstein Heins simply saying, “Let’s see where this goes.”

The company hired JPMorgan Chase & Co. (JPM) to assess their value and help them mull their options. The company could either enter into some kind of joint venture, or sell outright.

BlackBerry has seesawed in 2013, garnering record order shipments in March, then posting abysmal earnings in June. The company has simply failed to keep up with a rapidly changing market, and for a tech company, that’s a recipe for disaster.



The attractiveness of smartphones has become increasingly dependent on the software driving them, and not the hardware. Apple has the money to develop features like thumbprint ID technology for their iPhones. As their cash-on-hand dwindles, Blackberry has nothing in development that even comes close to approaching that level of innovation.

There are several options for BlackBerry’s future. It could go private, like Michael Dell is hoping to do with struggling PC maker Dell Inc (DELL). It could also sell out to a Chinese company like Huawei or Lenovo that wants to break into the American market.

Or, it could be bought out – and then scuttled entirely. As Recon analytics analyst Roger Etner speculates, although BlackBerry carries a reported $10 billion price tag, they do carry 5.4 percent of the American smart phone market. It could be profitable for a large company like Microsoft Corp. (MSFT) to claim that share by buying BlackBerry and then, as Etner put it, just “cannibalize or kill it.”

BlackBerry's stock jumped for the second straight day on the news, and is up 7.14 percent to $11.55 a share, paring back an advance of as much as 10 percent earlier in the day.

(Image: Research in Motion offices, courtesy of Fotopedia)

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
AAPL Apple Inc. 170.14 -0.96 -0.56 15,208,104 Trade
BBRY BlackBerry Limited n/a n/a n/a n/a
MSFT Microsoft Corporation 82.41 -0.79 -0.95 14,174,345 Trade
ALZTD ALZTD n/a n/a n/a 0

Comments

Emerging Growth

Naked Brand Group Inc

Naked Brand Group Inc through its wholly-owned subsidiary is engaged in manufacturing and selling of direct and wholesale men's undergarments to consumers and retailers.

Private Markets

The Green Organic Dutchman

The Green Organic Dutchman Ltd. ("TGOD") produces farm grown, organic cannabis for medical use. The company grows its high quality organic cannabis in small batches using craft growing, all natural…

iPRO Network, LLC

We provide the platform, tools, and resources to empower individuals and professionals to market desirable goods and services to the public, taking the place of traditional methods of commerce.