Weather New York, NY +76°F

Regions

Lenovo-BlackBerry deal will have obstacles - sources

Close
(Credit: Reuters) Financing of Blackberry Ltd's buyout would be dependent on its debt-free assets like the patents, licenses and secure network.Blackberry Ltd
October 18
11:10 AM 2013

Lenovo, a Chinese computer manufacturer, had signed a non-disclosure deal to examine the books of BlackBerry. However, the computer maker would face regulatory obstacles with the government of Canada if it would bid for all of the Canadian smartphone manufacturing company. This was according to a source that was familiar with the matter last Thursday. The Canadian government could block foreign takeovers should it deem a deal as not beneficial to the country or could pose a national security threat.

BlackBerry had virtually invented mobile email with its first pagers. However, it had rapidly lost market shares to rivals on year after year basis, said a report from Reuters. The new BlackBerry line of devices had generated dismal sales for the company. 

In August, Canada-based BlackBerry Ltd. said it would explore options including an outright sale. The smartphone manufacturer had been in discussions with potential buyers that included rival technology companies and private equity firms. 

The shares of BlackBerry had increased by 4%. This was after the Wall Street Journal had first reported the interest of Lenovo Group Ltd. to acquire BlackBerry. However, BlackBerry shares had closed less than 1% USD8.20 on the Nasdaq.

Meanwhile, senior Lenovo executives had on more than one occasion expressed interest acquiring the Canadian company or parts of it. This is because it would help to boost Lenovo's own smartphone business.

© 2019 VCPOST, All rights reserved. Do not reproduce without permission.
Tags
Share

Comments

Join the Conversation

Subscribe to VCpost newsletter

Sign up for our Deals of the Day newsletter.
We will not spam you!

Real Time Analytics