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Fairfax Financial Holdings Limited is a property, casualty, and life insurance company based in Toronto. Fairfax CEO Prem Watsa sat on the board of BlackBerry until August of 2013. Fairfax Financial has agreed to purchase BlackBerry in a deal worth $4.7 billion that would take the company private once again.
It is unknown as to what Fairfax has planned if and when the deal goes through. They could explore numerous options that include leaving the consumer handset market or even breaking up the company into various parts (such as BBM Inc.). The Diligence period is expected to be complete by November 4, 2013.
Yesterday BlackBerry put out a little press release about its convertible debenture offering. We posted a quick blurb about it, however in reading through the comments, I can tell many of you want a simple explanation of what’s going on.
No prob -- that’s why I’m here. Financial stuff can get a bit boring sometimes, and the people who write these releases sound like lawyers most of the time. They often have no clue how to just write in normal people speak.Continue Reading →
Now that I've had 24 hours to think about yesterday's interesting financial twist and read plenty of other reporting on the subject, I thought I'd come back with another post to clear up a few things.
First off, it was likely incorrect of me to say that Fairfax wasn't able to raise the $4.7 billion required to take BlackBerry private. I know some reputable media outlets said they were having trouble raising the money, but it sounds like the truth of the matter is a bit more nuanced. I think Fairfax probably could have raised the cash, but part of the cash would have come from BlackBerry taking on debt, and perhaps the interest rates being offered were unfavorable enough that it threw off the model. All of a sudden a leveraged buyout doesn't make sense.Continue Reading →
Thorsten Heins to step down as BlackBerry CEO at closingContinue Reading →
Bloomberg is reporting today that BlackBerry may be turning down a different road should funding from Fairfax Financial not pan out in their original deal. Fairfax has agreed to purchase BlackBerry in a deal worth around $4.7 billion however they may not be able to come up with funding to complete the transaction. If that's the case, BlackBerry may look to break up the company into the most valuable parts instead.Continue Reading →
It's only been less than two weeks since BlackBerry signed a letter of intent with Fairfax Financial to be sold for $4.7 billion. As part of the agreement, BlackBerry would be free during the due diligence period to discuss terms with other potential buyers if and when they arise.
An article appearing today in Reuters claims that BlackBerry is doing just that as sources say they are in talks with Cisco Systems, Google Inc and SAP to sell off parts of itself including their secure server network and patent portfolio.
While this news comes as a bit of a surprise, it could all be part of the strategic alternatives BlackBerry were exploring as they weigh their options. Furthermore, BlackBerry has also expressed interest in potential deals with Intel Corp, LG and Samsung, and are currently awaiting a response by early next week.
You can read the full text below and we'll be sure to keep you posted as these turn of events develop.Continue Reading →
While the BlackBerry/Fairfax deal is still being worked out, Fairfax Financial CEO Prem Watsa hasn't been afraid to state his intentions should the deal go through. He's confident that their bid for BlackBerry will pan out and has already been thinking ahead of just what actions to take to keep BlackBerry going.Continue Reading →
While some reports are saying that the bid entered by Fairfax Financial to buy BlackBerry for $4.7 billion won't succeed - Fairfax CEO Prem Watsa begs to differ. Even though the deal may not yet be fully financed, Watsa said in an interview with Reuters that he is confident in the bid, which puts shares at $9.
Fairfax is also BlackBerry's biggest shareholder and Watsa does not expect to have to contribute more than their 10% stake to the bid.Continue Reading →
On Friday most of the media was busy writing about the 4500 job cuts being the last nail in the coffin for BlackBerry. Today the company shook things up yet again. The rumours of Prem Watsa and his firm, Fairfax Financial, leading a bid to take the company private have proven to be true. The board of directors at BlackBerry has accepted an offer, conditional upon due diligence, of $9 per share.
Let’s put this all in plain English, shall we? Right now BlackBerry is a public company. Its shares trade on the stock exchange and anybody can go buy or sell stock. I’m a shareholder as are many of you. So if this deal happens, Fairfax and a consortium of investors will buy our shares from us at $9 each. BlackBerry will still exist in the same form as it does today, but it won’t be publicly traded so they won’t have to issue the same kind of press releases or file financial reports. They’ll be able to go silent and hide any negative financial results while they work towards a long term comeback.Continue Reading →