Blackberry Buys Rival Good Technology for $425M, Expecting $160M Revenue from the Acquisition
BlackBerry Ltd announced Friday that it acquired Good Technology for $425 million to improve its position in the Apple world.
BlackBerry expects to earn $160 million in revenue during the first year after the acquisition, which will close on November. This is according The Daly Mail UK. BlackBerry's shares listed in Toronto saw a 1.1 percent spike at C$7.97 in early during the trade. BlackBerry Chief Executive John Chen promised that their cash flow would remain positive overall. He said he sees a lot of opportunity to drive value for the company's stakeholders.
Chen said the merger of the two companies is a perfect fit for several different reasons, especially since both companies are focused on security and they are excellent when it comes to mobile device management.
BlackBerry will get more than 160 issued patents after buying Good. The move would also complement the areas where BlackBerry is not doing so well. It will add important accounts in banking, defense verticals, aerospace, and it will boost its mobile apps security. It will also improve its cross-platform features and enhance its sales network.
On the other hand, Financial Post reports Good provides mobile security solutions to more than 6,200 organizations from 189 countries all over the world. It filed plans to go on IPO in May 2014, but backed out due to the worsening of the market conditions. Good reported a US$ 211 million sales and a US$95.4 million in net loss.
According to the Waterloo-based smartphone company, two-thirds of the product activations featured in Good Technology are on devices runs on Apple's iOS, while the rest are on Android and Windows.
Chen told analysts, "What's most attractive to me is that the product platforms are extremely complementary."
"The combination of BlackBerry and Good will have market leadership and critical mass," said Chen.
These two companies complement each other. Where one is weak, the other is excellent. Just as Chen said, BlackBerry and Good are a perfect match.