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Blackberry Acquisition: Apple, Microsoft, Xiaomi & Lenovo Are In $7B Acquisition Race – Reports

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Blackberry

Blackberry is back in demand, and be assured that this is not 2010.

As per reports coming in from various sources, companies such as Apple, Microsoft, Xiaomi, Huawei and Lenovo are making plans to acquire this company and the deal may be in the range of $7 billion (Rs 42,000 crore).

As per an insider report, Microsoft has even hired Deutsche Bank and Goldman Sachs to evaluate the financial aspects of this acquisition.

On the other hand, Apple is now looking at the lucrative US Govt. contracts in mobile and business services, and in case they are able to acquire Blackberry, it will be a huge boost to their chances, considering that Blackberry is their only major competitor in this segment.

The current valuation of Blackberry has certainly increased since 2013 when Fairfax Financials offered to buy them for $4.7 billion (the offer was scraped later). Early this year, Samsung showed some interest in acquiring Blackberry in the range of $7-$7.5 billion, which again didn’t went through.

But Why Blackberry in 2015?

If we talk about the sales figures of handsets, then yes, Blackberry has junk value as of now. As per the latest IDC report (February, 2015), Blackberry has lost more than 69% of it’s market share since 2013 and last year they managed to sell only 5.8 million units.

However, their CEO is optimistic and has declared that they will sell 10 million handsets in 2015, and return to profitability by 2016.

But still, a million handsets doesn’t make them eligible to even stand with Xiaomi which recently created a world record by selling 2.1 million handsets within 12 hours. Last year they sold around 62 million units all over the world.

The Holy Trinity of Enterprise Mobile Market: Security, Integration & Patents

However, Blackberry has targeted a very specific niche within the mobile market, which it currently dominates and has plans to become a global leader very soon. This niche is the enterprise mobile market, and when you tag along security & integration features along with patents power with them, then there exist very few companies which can counter Blackberry’s might.

And this is the reason Apple and Microsoft and others are willing to shell upto $7 billion to acquire Blackberry.

Here are few factors which can be considered while evaluating Blackberry’s current position and their intentions:

New Handsets:

Last year during World Mobile Congress, Blackberry introduced some high level, security rich handsets meant for enterprise market. Considering that Microsoft is also offering similar products, this is certainly one of the key areas of it’s growth and expansion.

Partnership with Ford Motors:

Last year in December, Ford Motors ditched Microsoft’s Windows OS and chose Blackberry for their new state of the art Sync System, which is an in-vehicle OS designed to connect their digital services. Robust security features from Blackberry were cited as the reasons. Microsoft and Apple, both are aware of this development and they actually can’t ignore the dangers if they don’t acquire Blackberry now.

Share Prices Are Up:

Last year in December, Blackberry share prices hovered around $5.50, which has now doubled to $10.53 (at the time of writing). Market analysts are predicting that the share prices of Blackberry will continue to rise, and it can even cross 50% increment by the time 2015 ends.

Blackberry Is Much More Than Handsets Now

Ever since Blackberry realized the fact that their grip on the ‘consumer’ market is sliding, they realigned their business objectives, and now, they are no more about just handsets. They have programmed themselves to solve one major problem of enterprise mobiles which is Security, and their all efforts are targeted for the same.

For example, in case a business establishment attempts to implement the Bring Your Own Device (BYOD) mechanism in their office, they can’t rely on Android or iOS to safeguard their data; it’s the Blackberry handsets which they will trust.

Similarly, they are working on several new, exciting patents concerning enterprise security in mobility and handheld devices, which can make Apple and Microsoft dwarf in this arena.

$7 billion for capturing this lucrative market is certainly a no-brainer. We will keep you updated as we receive more news regarding Blackberry acquisition.

[Header Image: Shutterstock.com]

  1. nick says

    Another speculative piece of junk journalism. Their patentents alone are worth that much. Given the investments of the top two holders, I can’t see anything under $14-20B for the company being worth it since the downside is little given cash on hand and value of the patents.

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