BlackBerry to go private as quick fix for dropping shares

By IVCPOST Staff Reporter

Aug 17, 2013 04:19 AM EDT

BlackBerry finds itself on the verge of going private, according to analysts in a Reuters report. On a financial standpoint, the move may make sense, say executives for a private equity firm who declined to named. However, in itself, the action may not be enough to make BlackBerry competitive again, they added.  They also concluded that a leveraged takeover may be another option that Blackberry could consider.

The decline in the BlackBerry's recent sales, compared to iPhone's soaring figures, has been disappointing. Even with the recent launch of its newest model, BlackBerry failed to compete with its rivals. Despite that, BlackBerry remains stable with its cash flow.

Currently, BlackBerry value is pegged at USD5 billion. However, Ross Healy of MacNicol & Associates refutes the estimate. He points out that BlackBerry has more than that since they have USD3 billion in cash. "My own analysis tells me that the stock is worth an awful lot more than $5 billion," said Healy. Healy, who is a portfolio manager, has clients owning shares of Blackberry.

BlackBerry has not given any official statement regarding the matter.

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