Samsung make offer to buy BlackBerry for as much as $7.6 billion. With this move the South Korean company will try to secure the patents of the Canadian manufacturer and to acquire its secure corporate mobile services. This information comes from Reuters news agency quoting internal sources and documents.
According Reuters Samsung proposed initial price range of $13.35 to $15.49 per share for BalckBerry. This is a very generous offer, because it presented a 38 to 60% premium to the shares close price in Wednesday. And valued the Canadian company to approximately $7.6 billion.
But this rumor was dismissed by BlackBerry few hours after Reuters article went online.
“BlackBerry has not engaged in discussions with Samsung with respect to any possible offer to purchase BlackBerry. BlackBerry’s policy is not to comment on rumors or speculation, and accordingly it does not intend to comment further”, says the company’s statement.
So how plausible is this rumor, especially given the fact it came as exclusive information from Reuters? It is very likely that such conversations for possible acquisition was been held. Most probably those talks were unofficial and off the record or in very early stages. Also with those types of big deals it is common for the sides to sign a non-disclosure agreements. And this makes BlackBerry’s reaction very natural.
The rumors for BlackBerry’s efforts to find a potential investor or buyer are not from yesterday. In the past two years there have been few reports about Lenovo’s appetite for the Canadian manufacturer. And BlackBerry said before two years that it explore every possible strategic option for its restructuring including selling the company.
Another big question in this rumor is the price proposed by Samsung. First according Reuters this is a preliminary price, but still it is very generous offer. Samsung could get a lot of value if it buy BlackBerry. The Canadian company loses its previous dominance in the smartphone market and now is a very negligible player. But it holds few very precious assets – it has a big patent portfolio and a very reliable and secure mobile corporate services.
Both assets could help a lot Samsung in its efforts to retain its leading position in the smartphone market. If South Korean giant buy BlackBerry it could easily incorporate its services in the Samsung’s devices and lure corporate clients. And also without the smartphone production BlackBerry could be profitable.
The verdict is this rumors about merger talks between the two companies are very plausible. Especially if those are still unofficial and preliminary. But this will not guarantee that Samsung may make an official offer and actually buy BlackBerry.
Plausibility for such preliminary offer – 75%
Plausibility for an official offer – 50%
Image Credit: Gaurav Amarnani (CC)